BlueScope draws battle lines with SGH and Steel Dynamics, ‘remains open’ to fair offer
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The news: The BlueScope board has flagged that the SGH and Steel Dynamics consortium’s “best and final” takeover offer could be worth less than previous offers it has rejected when considering expected dividend payments later this year, but remains open to a ‘fair value’ transaction.
The grounds for further engagement are outlined in a letter sent by BlueScope chair Jane McAloon to SGH managing director and CEO Ryan Stokes and Steel Dynamics chair and CEO Mark Millett. It was filed to the exchange by BlueScope on Thursday morning.
The numbers: While the offer has a headline price of $34 per share, this includes $1.65 per share worth of dividends already paid out by BlueScope.
When considering the total $3 per share that BlueScope intends to distribute in 2026, as announced at its half-year earnings release, BlueScope argues the transaction could be worth as low as $31 per share, if completed in 2027.
This would be lower than a previous Steel Dynamics offer that had an implied value of $33 per share that was rejected in 2025.
The context: The latest approach is Steel Dynamics’ fifth attempt to buy BlueScope’s US business, although the intensity of takeover efforts has ramped up from January 2026.
In the letter, McAloon reiterated her call for specificity on the value attributed to BlueScope’s North America operations and its Rest of World operations given that SGH intends to on-sell the former to Steel Dynamics.
She also flagged it is not clear if the revised proposal is conditional on the on-sale of BlueScope’s North American operations to Steel Dynamics, which “would have a material impact on the expected timeframe and execution risks associated with transaction completion”.
SGH and Steel Dynamic’s proposed requirements for “hard exclusivity” regarding access to a “substantially populated data room” and for the BlueScope board to “confirm its intention to unanimously recommend the Revised Proposal, prior to you commencing due diligence”, have been characterised by McAloon as “onerous conditions”.
McAloon also asked for clarity regarding SGH’s financing arrangements, characterising letters from JP Morgan and ANZ as “non-binding and highly conditional”.
What they said: “If you are able to address the matters we have raised in this letter including, importantly, increasing the value of your proposal for all BlueScope shareholders, the Board is open to further engagement with you, including provisioning some due diligence information,” McAloon’s letter reads.
“We look forward to your response.”
The source: ASX
