Big River Steel reportedly considers sale options

Big River Steel reportedly considers sale options

Arkansas EAF steelmaker may be weighing its future as an independent firm, say published reports.

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September 3, 2018
Brian Taylor
Ferrous Financial

Osceola, Arkansas-based Big River Steel (BRS), one of the newest electric arc furnace (EAF) steelmaking firms in the United States, is reportedly accepting bids to be sold in early September.

Metals information service provider American Metal Market (AMM) reported in late August that one or more stakeholders in the firm could be interested in selling its stake. The same article also speculates the bids may be received only so BRS can help establish a price for its own initial public offering (IPO).

BRS has several double-digit stakeholders in its current ownership form, according to AMM, including a subsidiary of Wichita, Kansas-based Koch Industries; the estate of BRS co-founder John Correnti; Global Principal Partners LLC, a Miami-based investment firm where BRS CEO David Stickler serves as managing director; San Francisco-based private equity firm TPG Capital LP; and the Arkansas Teacher Retirement System pension plan.

An early September online article by the Little Rock, Arkansas-based Arkansas Times indicates the newspaper reached a manager of the Arkansas teacher pension fund, who responded that the group “has not attempted to sell its minority ownership position,” and that it considers BRS “a strong and safe investment.”

In terms of serious bidders that may wish to genuinely acquire the entire BRS complex in Osceola, AMM speculates Charlotte, North Carolina-based Nucor Corp. is one likely candidate, as that firm is protective of its dominant EAF market position in the Southeast.

Another candidate AMM points to is United Kingdom-based Liberty House Group, which has recently invested in restarting an EAF mill in Georgetown, South Carolina. Liberty House and its parent company, the GFG Alliance, have stated they seek to have some 5 million tons per year of steelmaking capacity in the U.S.

While the Liberty House Georgetown mill has just 700,000 tons per year of capacity, BRS is on track to have more than 6 million tons of capacity by early next decade, combining planned capacity in Osceola and a proposed second BRS mill in Brownsville, Texas.

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