Nucor said on Monday that it had agreed to buy Gallatin Steel for $770 million in cash from ArcelorMittal and Gerdau of Brazil.
Gallatin has been a 50-50 joint venture between ArcelorMittal, the world’s largest steel producer, and Gerdau. Another Brazilian steel maker, CSN, had previously sought to buy out their stakes, Bloomberg News reported last month.
The mill, in Ghent, Ky., melts scrap, pig iron and hot briquetted iron from various source and produces 1.8 million tons of flat-rolled steel a year. It started operations in 1995.
Nucor said the addition of its mill would it increase its flat-rolled product capacity by 16 percent.
“Gallatin will enhance Nucor’s current position serving flat-rolled customers in the growing pipe and tube segment,” John Ferriola, chairman and chief executive of Nucor, said in a statement. The purchase price, he said, represents a multiple of 6.4 times estimated 2015 earnings before interest, taxes, depreciation and amortization, or Ebitda.
Source: The New York Times
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