Australia's BlueScope Steel gets $8.8 billion buyout offer from SGH, Steel Dynamics

SEATTLE (Scrap Monster): Australia's BlueScope Steel said on Monday it received an A$13.15 billion ($8.78 billion) takeover proposal from an investor group comprising billionaire Kerry Stokes-owned SGH and U.S.-based Steel Dynamics.

The proposal made in December marked the latest attempt by Steel Dynamics to buy Australia's largest steel producer, and comes as the sector grapples with U.S. President Donald Trump's tariffs on steel imports.

BlueScope operates five businesses in North America and was considered largely shielded from tariffs as it ships a small amount of steel from Australia to the U.S., but weak demand and a significant writedown on its U.S. metal coatings unit affected its fiscal 2025 earnings.

On December 12, Sydney-listed industrial conglomerate SGH and Nasdaq-listed Steel Dynamics made an A$30-a-share cash offer, implying a premium of 26.8% to BlueScope's close on December 11 and a 22.7% premium to its latest close.

The takeover offer, disclosed late on Monday, would see SGH acquire all of BlueScope's shares and then offload its North American businesses to Steel Dynamics.

BlueScope's board is considering and evaluating the latest takeover proposal, the steelmaker said in an exchange filing.

SGH and Steel Dynamics confirmed the offer in a joint statement. The two parties said they had also entered a 12-month exclusivity agreement with each other and have committed significant resources to progress the deal.

AustralianSuper, the country's largest pension fund and BlueScope's biggest shareholder with a 12.51% stake, also did not respond immediately outside business hours.

BlueScope disclosed for the first time that it had rebuffed three separate unsolicited takeover approaches, including two from a different Steel Dynamics-led consortium in late 2024, offering A$27.50 and then A$29.00 per share.

Both proposals would have resulted in Steel Dynamics owning BlueScope's North American businesses.

A third Steel Dynamics proposal in early 2025 would have acquired all of BlueScope, retained its North American operations, and distributed the remaining assets to BlueScope shareholders. It valued the North American operations at A$24 per share and other assets at no less than A$9 a share.

"These approaches were rejected as they significantly undervalued BlueScope and its future prospects, and presented significant execution risk in relation to regulatory outcomes," BlueScope said.

Courtesy: www.reuters.com