Steel Dynamics Inc. (SDI) has completed its acquisition of Mexican ferrous and nonferrous scrap recycler Roca Acero SA de CV.
The Fort Wayne, Ind.-based EAF steelmaker did not disclose the purchase price but said the deal was paid for in cash.
“Combined with our existing metals recycling facilities in Mexico, the addition of Roca significantly strengthens our ferrous and nonferrous raw material procurement strategy in the region,” SDI chairman, president, and CEO Mark D. Millett said in a statement on Tuesday, Oct. 4.
“We believe our Mexican metals recycling facilities will provide a meaningful advantage to our electric-arc-furnace steel operations and planned aluminum flat-rolled products operations, while also providing a high-quality, customer-centric option for our customers in Mexico and the US,” he said.
Roca Acero, a Monterrey, Mexico-based metals recycler, operates five ferrous and nonferrous scrap metal recycling facilities “strategically positioned near high-volume industrial scrap sources” in central and northern Mexico, according to SDI.
Roca currently ships approximately 575,000 gross tons of scrap annually. It has an annual processing capability of roughly 850,000 gross tons per year, the company said.
The acquisition of Roca Acero is SDI’s second acquisition in the Mexican scrap market. The steelmaker in August 2020 closed a deal for Monterrey-based scrap recycler Zimmer SA de CV.
With the two Mexican metals recycling businesses, SDI estimates its annual ferrous and nonferrous scrap processing capability within Mexico will be over 2.5 million gross tons.
The scrap will help feed SDI’s new EAF sheet mill in Sinton, Texas. The new mill, which officially started up in the first quarter of this year, cost $1.9 billion and has a steelmaking capacity of 3 million tons per year.
Like all EAFs, its primary feedstock is scrap, and SDI’s latest move helps ensure it has enough feedstock for its mills.
The Sinton mill is near Corpus Christi, a port city in southern Texas, and is approximately 300 miles from Monterrey — Mexico’s traditional industrial heartland.
By David Schollaert, David@SteelMarketUpdate.com
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