BlueScope rallies after SGH acquisition proposal
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More news: BlueScope shares rallied at midday following solid morning trade after SGH Limited confirmed it has launched a bid with Nasdaq-listed Steel Dynamics to acquire 100% of the steelmaker BlueScope Steel.
BlueScope was the top performing stock across the ASX 200, with shares up 20.4% to $29.44 as of 11:52am AEDT.
SGH and Steel Dynamics confirm BlueScope acquisition proposal
The news: Kerry Stokes-controlled industrials conglomerate SGH Limited has confirmed it has launched a bid with Nasdaq-listed Steel Dynamics to acquire 100% of BlueScope Steel, according to its latest ASX announcement.
Following completion of the transaction, if the proposal is implemented, SGH would on-sell BlueScope’s North American operations to Steel Dynamics, while retaining the remaining 'Australia and rest-of-world' operations.
SGH has appointed Barrenjoey and Goldman Sachs as financial advisors and Allens as legal adviser. Steel Dynamics has appointed JP Morgan as financial adviser, Ashurst as Australian legal adviser, and Skadden, Arps, Slate, Meagher and Flom, and Barrett McNagny, as US legal advisors.
SGH and Steel Dynamics stated that there is no certainty that the proposal will result in a transaction and is subject to customary conditions.
The context: The announcement follows BlueScope Steel's response to media speculation on Monday that it had received an unsolicited, non-binding indicative proposal from SGH and Steel Dynamics.
According to SGH, the proposal to acquire BlueScope shares for a wholly cash consideration of $30 per share would provide shareholders with a material uplift in value and an attractive premium. The offer implies a total equity value for BlueScope of $13.2 billion.
What they said: "We believe the acquisition of BlueScope's Australian business is a strong strategic fit for SGH and we have a proven track record of driving performance improvement in domestic industrial businesses." SGH managing director and CEO Ryan Stokes said.
"We intend to leverage our disciplined operating model and capital allocation approach to deliver better outcomes for stakeholders."
The source: ASX
