Billionaire Sajjan Jindal-led JSW Steel Ltd has agreed to acquire US-based steel mill owner Acero Junction Holdings Inc. for up to $80.85 million (Rs 527 crore) in cash to expand its North America operations.
The acquisition will help JSW Steel establish its presence in Ohio, US, and gain deeper access to the North American steel market, the company said in a stock-exchange filing on Thursday.
The deal comes barely days after India's biggest local steelmaker said earlier this week it would invest $500 million in its Texas unit, which it had acquired in 2007.
JSW Steel, part of the OP Jindal Group, is not new to acquisitions and has bought a number of companies over the years. In recent weeks it has bid for debt-laden peers Bhushan Steel Ltd and Essar Steel Ltd, albeit without success.
The transaction for Acero is likely to close in 60 days' time, subject to fulfillment of certain conditions precedent, the filing said.
Acero Junction Holdings was set up in July 2016 and recorded revenue of $44.27 million until the end of December 2017.
It owns 100% of Acero Junction Inc., which runs a steel mill that produces hot-rolled coils. The company supplies hot-rolled bands to coil processors, cold-rolled strip producers, pipe and tubers, original equipment manufacturers and steel service centres across North America.
The Ohio facility includes an electric arc furnace, ladle metallurgy furnace, slab continuous casting machine, and a 3 million tonne per annum hot strip mill. According to its website, Acero Junction began operations in July 2016 by acquiring the electric arc furnance and rolling mill of the Wheeling Pittsburgh plant, which has an operating history dating back to 1872. The mill was re-commissioned and started producing hot-rolled coils from May 2017.
The company expects North America's demand for hot rolled bands to grow to 28 million tons, according to its website.
JSW Steel makes flat and long-steel products such as hot-rolled coils, cold-rolled coils, galvanised products, colour-coated products, autograde flat products, bars and rods. It has an installed capacity of 18 million tonnes per annum.