Market Segment
April 21, 2026
SDI's Millett upbeat on M&A despite rejected BlueScope bid
Written by Ethan Bernard
Steel Dynamics Inc’s (SDI’s) chief executive is bullish on M&A opportunities despite the rejection of its joint bid for Australia’s BlueScope Steel.
SDI Chairman and CEO Mark Millett was asked if there were any new developments on the proposed deal with diversified Australian operating company SGH Limited to buy BlueScope.
“Obviously, we never talk with great specificity as to what we are doing from a strategic standpoint,” Millett said on an earnings call Tuesday.
“We presented what we consider a best-and-final joint offer (in February),” he continued. He called that offer “full and fair.”
(The most recent update on the rejected deal from February is here, with BlueScope saying the door was still open.)
“That offer was summarily rejected, and there has been no constructive engagement by the company since,” Millett said.
Other opportunities
He was also asked how the Fort Wayne, Ind.-based company was thinking about downstream vs. steel growth vs. organic projects.
“Our strategic philosophy has not changed,” Millett said. “We pursue and explore all opportunities.”
Specifically, Millett was asked if SDI was eyeing entering into plate. He said Nucor already serves the plate market well.
Charlotte, N.C.-based Nucor has three plate mills: Nucor Hertford County in North Carolina, Nucor Steel Tuscaloosa in Alabama, and the most recent is Nucor Brandenburg in Kentucky.
“Our focus has been and will be downstream—innovative ways to improve and bring value to the supply chain in different products we are not in today,” Millett said. “We are not in business just to grow to get bigger.”
He stated that SDI focuses on value-add, differentiating products, and supply chains. And there are “myriad” opportunities under exploration.
Millett said SDI took a bit of a hiatus, given cap-ex for its recent Sinton mill in Texas and Aluminum Dynamics projects.
“Now that is behind us, we will continue to explore those opportunities,” Millett said. “In aluminum, it is phenomenal where we could go.”
Improved steel environment
On the steel side, SDI expects current higher flat-rolled steel pricing to boost second-quarter results.
This comes on the heels of the steelmaker reporting increased Q1’26 earnings on robust steel tags and record shipments.
“Approximately 75% to 80% of our flat-rolled steel business is linked to lagging priced contracts, in aggregate, generally lagging two months,” EVP and CFO Theresa Wagler said. “So the most recent flat-rolled steel price increases will positively impact our second-quarter results.”
She noted the company’s steel operations generated operating income of $557 million in the first quarter. This was a 73% sequential increase as average selling prices increased by $86 per ton.
From an index perspective, Wagler said HRC pricing jumped from an average of $850/ton in Q4’25 to $975/ton in the first quarter. And now it’s over $1,000/ton.
(You can track SMU’s HRC prices here.)
Value-added spreads to HRC have also improved, according to Wagler. “As the largest coater in North America, this will especially be helpful to our forward performance.”
Looking ahead, SDI President and COO Barry Schneider was also optimistic.
“Regarding the flat-rolled steel markets, conditions continue to improve, supported by strong demand and lower imports,” he said. “Lead times remain elevated and customers remain optimistic about the outlook.”
Pig iron
Schneider was asked about the recent increases in pig iron prices. (See SMU’s Stephen Miller’s recent article here.)
“We only use pig iron at our flat rolled mills,” Schneider said.
He said their Butler flat rolled mill in Indiana has its own technology for making liquid iron that takes care of about 90% of the mill’s needs. It’s produced from recycled “very sustainable” iron oxide products.
Schneider pointed out the company’s Columbus, Miss., and Sinton, Texas, flat rolled operations are the primary users of pig iron.
“Mitigation really comes through our relationship with Omni(Source), our scrap provider,” Schneider said. “We have an incredible connection between scrap and steel.”
OmniSource is SDI’s wholly owned scrap subsidiary.
Schneider noted SDI looks at cost and availability every day: “We keep good positions, mindful of working capital, and do not binge. Our teams between Omni and scrap and our melt shops do a great job, coordinated by a strong iron team.”
He said that while prices might go up, “we keep finding better ways to minimize impact.”
(Note that earnings from SDI’s aluminum subsidiary, Aluminum Dynamics Inc., has been covered in SMU’s sister publication, Aluminum Market Update.)
