Scrap Consumers
January 19, 2024
Gerdau to sell stakes in two mills
Brazil-based steel maker Gerdau will divest its 50.00% equity interest in Gerdau Metaldom and 49.85% holding in Gerdau Diaco, plus their subsidiaries, to the Incia Group, the group’s partner in the two joint ventures, for $325 M (€299 M).
The JVs operate in Colombia, the Dominican Republic, Panama and Costa Rica and between them have 360,000 t of meltshop capacity and 1.25 Mt of long steel rolling capacity. Diaco is also a major ferrous scrap recycler in Colombia. Metaldom’s steel mill is in the Dominican Republic.
The transaction is expected to conclude by the end of June, subject to Colombian anti-trust authority approval and customary closing conditions.
In a Securities and Exchange Commission (SEC) filing, Gerdau said the divestment meets its capital allocation strategy which focuses on growth and competitiveness of assets with greater potential for generating long-term value. Proceeds from the sale will be allocated to the group’s capex programme.
