Update: Acerinox suspends Aperam merger talks

Update: Acerinox suspends Aperam merger talks

Merger of stainless steel producers would have seen North American Stainless be part of larger European-based company.

June 6, 2022

Merger talks between stainless steel producers Acerinox S.A., headquartered in Madrid, and Luxembourg-based Aperam, have halted, according to a filing made by Acerinox.

In a June 3 statement, Aperam stated that “very preliminary discussions with Acerinox with respect to a possible transaction that may result in a business combination have been recently engaged.”

Aperam, a producer of some 1.8 million metric tons of stainless steel annually, continued, “Those discussions are at an early stage, and no agreement has been reached as to the scope, structure or terms of any possible transaction. There is no certainty that any such agreement will be reached or, if so, on what terms. Aperam will, consistent with its legal obligations, inform the market as and when it is required to do so.”

On June 6, however, Reuters and other media outlets reported that Acerniox filed a statement with Spain's Bolsa de Madrid stock exchange to declare, “The board of the company in a meeting today agreed unanimously not to continue with the preliminary talks with Aperam to evaluate a possible corporate operation.”

Acerinox, which operates the scrap-consuming North American Stainless mill in Kentucky, is on track to produce more than 2.6 million metric tons of stainless steel this year, according to its first quarter financial results.

Aperam’s melt shop production is concentrated in western Europe, although the company is building a slab production facility in Brazil. In North America, Aperam operates a stainless steel service center in Sterling Heights, Michigan.

Two metals industry analysts quoted June 3 by Reuters raised the question of whether Europe’s antitrust or competition agencies would have approved of a merger without conditions in that market.

The industry observers also said any transaction likely would have needed to be agreed to by the Mittal family, which owns about 40 percent of Aperam, and the March family, which owns nearly 20 percent of Acerinox.