Severstal buys Sparrows Point steel mill
Russian steel company OAO Severstal said on Friday it will buy the Sparrows Point steel in the US from ArcelorMittal for $810 million (euro521 million) in cash.
By Agencies |
MOSCOW: Russian steel company OAO Severstal said on Friday it will buy the Sparrows Point steel in the US from ArcelorMittal for $810 million (euro521 million) in cash.
Sparrows Point is a fully integrated mill in Baltimore, Maryland. The purchase will make Severstal the No. 4 steel producer in the US. Its North American division also includes a mill and other facilities in the Detroit area and in Columbus, Mississippi.
Sparrows Point has a capacity of 3.6 million metric tons (3.9 million tons) of crude steel. It is the only integrated producer of flat rolled steel on the U.S. East Coast.
Severstal and the United Steel Workers union have agreed to enter into a collective-bargaining agreement, the company said.
ArcelorMittal, based in Luxembourg, agreed in February 2007 to sell Sparrows Point to resolve U.S. Justice Department antitrust concerns about production of tin-plated steel. ArcelorMittal, the world's largest steelmaker, was formed by a merger of Mittal Steel Co. NV, of the Netherlands, and Arcelor SA of Luxembourg. The merger was completed in November.
``With Sparrows Point, Severstal brings into its U.S. portfolio an asset with significant existing value as well as unlocked growth potential,'' CEO Alexei Modashov said in a statement.
Severstal reported this week that net profit for last year rose 33 percent from the year before as the company benefited from a strong European market, but said its North America results for the year were hit by weaker market conditions in the region and a planned outage related to the rebuilding of a blast furnace.
Sparrows Point is a fully integrated mill in Baltimore, Maryland. The purchase will make Severstal the No. 4 steel producer in the US. Its North American division also includes a mill and other facilities in the Detroit area and in Columbus, Mississippi.
Sparrows Point has a capacity of 3.6 million metric tons (3.9 million tons) of crude steel. It is the only integrated producer of flat rolled steel on the U.S. East Coast.
Severstal and the United Steel Workers union have agreed to enter into a collective-bargaining agreement, the company said.
ArcelorMittal, based in Luxembourg, agreed in February 2007 to sell Sparrows Point to resolve U.S. Justice Department antitrust concerns about production of tin-plated steel. ArcelorMittal, the world's largest steelmaker, was formed by a merger of Mittal Steel Co. NV, of the Netherlands, and Arcelor SA of Luxembourg. The merger was completed in November.
``With Sparrows Point, Severstal brings into its U.S. portfolio an asset with significant existing value as well as unlocked growth potential,'' CEO Alexei Modashov said in a statement.
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Severstal reported this week that net profit for last year rose 33 percent from the year before as the company benefited from a strong European market, but said its North America results for the year were hit by weaker market conditions in the region and a planned outage related to the rebuilding of a blast furnace.
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