Steel Mills
AHMSA and Villacero Sign Non-Binding Purchase Agreement
Written by Sandy Williams
June 19, 2020
Mexican steelmakers Altos Hornos de México (AHMSA) and Villacero have a signed a non-binding agreement to merge assets as a new company. The agreement gives the two parties 90 days to complete regulatory documents to move forward with the reported $300 million deal.
A June 18 filing with the Mexican Stock Exchange said:
“The agreement signed by Alonso Ancira, president of AHMSA, and Julio Villarreal, president of Grupo Villacero, includes financial obligations that will allow AHMSA to settle liabilities and capitalize through the capture of fresh resources, in order to ensure its operational continuity in the long term.”
AHMSA has been in financial straits for several years and reported a steel segment operating loss of $95 million in Q4 2019. The COVID-19 pandemic added to the company’s woes as steelmaking operations were disrupted by supply chain issues and manufacturing closures. The merger is welcomed by local suppliers who say they have been owed money for over a year.
Earlier this year, South Korean steel producer POSCO and Techint, owner of Ternium and Tenaris, expressed interest in acquiring the AHMSA assets.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Mills
CRU: Tata Steel looks to shed 1,600 jobs in the Netherlands
The company said, “The challenging demand conditions in Europe driven by geopolitical developments, trade and supply chain disruptions and escalating energy costs have affected the operating costs and financial performance."
Reports: Federal funding for Cliffs’ project could be slashed
Elon Musk's DOGE is determining which Department of Energy grants to advance and which ones to terminate, according to several media outlets
Trump still against selling USS to Japanese firm: Report
Despite ordering a new review of Nippon Steel’s bid for U.S. Steel, President Trump said he is still against selling USS to a Japanese company, according to media reports.
Algoma looks to sell more steel in Canada in wake of Trump’s tariffs
The Canadian steelmaker said its absorbing higher tariffs as it moves forward.
Ancora abandons plan to take over leadership of USS
Investment firm Ancora Holdings Group has halted its play for U.S. Steel's board, citing Nippon Steel’s proposed bid for USS “gaining momentum.”