ThyssenKrupp AG (TKA) agreed to sell its U.S. plant to ArcelorMittal (MT) and Nippon Steel & Sumitomo Metal Corp. for $1.55 billion as Germany’s largest steelmaker seeks to offload the Steel Americas operations that are the worst investments in its more than 200-year history.
The transaction includes an Alabama facility and a six-year agreement to purchase 2 million metric tons of slab annually from ThyssenKrupp’s Brazil plant, Luxembourg-based ArcelorMittal said today in a statement.
ThyssenKrupp, based in Essen, spent the past 18 months trying to dispose of plants in Alabama and Brazil’s Rio de Janeiro state after writing down their value by 6.4 billion euros ($8.7 billion). Steel Americas helped wipe 14 billion euros off its parent’s market value since 2008 and forced it to abandon dividends.
ThyssenKrupp Chief Executive Officer Heinrich Hiesinger is seeking to diversify away from steelmaking as waning demand from automakers and builders and competition from China has pushed prices and profits lower. Hiesinger plans to build up operations from elevators to auto parts and marine services.
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