SGH Ltd and Steel Dynamics have jointly submitted a best and final offer of A$32.35 per share to acquire BlueScope Steel, valuing the company at A$15 billion and representing a significant premium over recent trading prices.
- Revised offer of A$32.35 per share values BlueScope at A$15 billion
- Offer includes a 47% premium over BlueScope’s initial closing price
- Post-acquisition, SGH to retain Australia and Rest of World operations
- Steel Dynamics to acquire BlueScope’s North American operations
- Transaction subject to due diligence, regulatory and shareholder approvals
A Bold Move in Steel Industry Consolidation
SGH Ltd and US-based Steel Dynamics, Inc. have jointly escalated their bid to acquire BlueScope Steel Ltd, submitting a best and final non-binding indicative offer of A$32.35 per share. This revised proposal values BlueScope at approximately A$15 billion (US$11 billion), representing a substantial premium over the steelmaker’s recent market prices and signalling a strong commitment from both parties to secure the deal.
The offer price reflects a 47% premium to BlueScope’s adjusted closing price at the time of the initial proposal and a 56% premium to its 52-week volume-weighted average share price. This premium underscores the strategic importance SGH and Steel Dynamics place on BlueScope’s assets and market position.
Strategic Division of BlueScope’s Operations
Under the terms outlined, SGH plans to retain BlueScope’s Australian and Rest of World operations, leveraging its strong industrial platform and capital base to drive performance improvements. Meanwhile, Steel Dynamics will acquire BlueScope’s North American operations, which align closely with its existing steel production, metals recycling, and building products businesses.
This division of assets appears designed to maximise value for both acquirers by playing to their respective strengths and regional focuses. SGH’s stewardship of the Australian operations could bring disciplined operational improvements, while Steel Dynamics’ expansion in North America could enhance its market footprint.
Conditions and Next Steps
The offer remains subject to customary regulatory approvals, due diligence, and shareholder consent. Both SGH and Steel Dynamics have expressed confidence that there are no material obstacles to obtaining the necessary clearances, but the proposal is non-binding and discussions with BlueScope are ongoing.
Investors will be watching closely for any competing bids or developments in the due diligence process that could influence the transaction’s trajectory. The deal, if completed, would mark a significant consolidation in the steel sector, with potential implications for competition and market dynamics in Australia and beyond.
SGH has committed to providing further updates as material developments occur, maintaining transparency in line with ASX disclosure requirements.
Bottom Line?
The steel sector braces for a potential landmark deal that could reshape regional operations and investor returns.
Questions in the middle?
- Will BlueScope’s board recommend this revised offer to shareholders?
- Could a competing bid emerge to challenge SGH and Steel Dynamics’ proposal?
- How will the division of BlueScope’s assets impact operational synergies and market competition?