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BlueScope Rejects Revised Steel Dynamics Bid
Australian Steelmaker Says $11 Billion Offer From US Firm Steel Dynamics and SGH Still Falls Short for Shareholders
Australia’s BlueScope Steel said a revised bid from Steel Dynamics and SGH undervalues the company, but it remains open to a better offer.
U.S. firm Steel Dynamics and Australian conglomerate SGH last weektableda “best and final” proposal for the steelmaker, raising their bid to A$32.35 a share, representing a total equity value of A$15 billion ($11 billion). BlueScope on Feb. 26 in Australia said the bidders need to increase the value for shareholders if talks are to be taken seriously.
“The revised proposal does not adequately address our valuation concerns,” BlueScope said in a statement. “Consequently, the offer price is not sufficient for the board to recommend a scheme of arrangement to its shareholders.”
“The board remains open to a transaction at a price that reflects the fair value of BlueScope,” the company added.
In January, BlueScope said it received threeprevious offersfrom Steel Dynamics, which is eyeing the company’s low-margin steel business in North America — which generates the majority of its earnings.
Steel Dynamics and SGH — controlled by billionaire Kerry Stokes — plan to split the business, with the U.S. company intending to take the North Star steelworks in Ohio and the downstream product business in North America, while SGH would control the Australian steelworks at Port Kembla.
