Stelco Holdings Inc. is targeting deals in North America valued over US$500 million after the U.S. lifted steel and aluminum tariffs on Canada and Mexico, Bloomberg News reported May 22, citing Executive Chairman Alan Kestenbaum.
According to the report, the deals may include scrap-centric mini-mills that are benefiting Nucor Corp. and Steel Dynamics Inc., as long as it will complement the steelmaker's profile.
In addition, Kestenbaum said galvanized steel, cold-rolled steel and slab steel assets in either U.S. or Canada are seen as areas of interest.
The removal of U.S.-imposed tariffs greatly benefitted the steelmaker, as it resulted in new orders, with Stelco's market value increasing five-fold to about US$1.2 billion, the report said.
To fund the potential acquisitions, Kestenbaum noted that Stelco may opt to take in short-term debt. However, it would aim to repay any new debt within 12 to 18 months. It may also choose to divest assets — including about 800 acres of land in Hamilton, Ontario, as well as a 2,400-acre site next to its Nanticoke facilities on Lake Erie.