Gerdau, the largest recycler in Latin America and a leading producer of long steel, has announced the completion of the sale to US-based Commercial Metals Company (CMC) of four rebar mills and rebar fabrication locations.
The sale includes mills in Jacksonville, FL, Knoxville, TN, Rancho Cucamonga, CA, and Sayreville, NJ, as well as all of Gerdau’s US rebar fabrication facilities. The transaction was originally announced on 2 January 2018, for US$ 600 million, as well as an approximately $100 million estimated working capital adjustment. According to Gerdau, the purchase price is subject to a further customary purchase price adjustment as described in the Purchase Agreement and the cash received will be used to reduce financial leverage.
Gerdau claims to maintain a strong presence in North America. With 13 steel mills located throughout the US and Canada, the company continues to be a leading producer of structural steel, merchant bar, and special bar quality products, as well as rebar.
Gustavo Werneck, CEO of Gerdau, commented: “The completion of this transaction represents an important milestone in our strategy to reduce financial leverage and to focus on better return opportunities. We will accelerate growth in attractive segments in North America, one of our core markets, and will continue to serve and create value for customers in the construction, industrial equipment, transportation and energy markets”.
Gerdau is listed on the stock exchanges of São Paulo, New York and Madrid.