Flat-rolled steel and iron ore pellet producer Cleveland-Cliffs Inc., headquartered in Cleveland, has completed its acquisition of Ferrous Processing and Trading Co. (FPT), including certain related entities. The company announced the final necessary regulatory clearances in connection with the transaction were received Nov. 17, with FPT becoming a wholly owned subsidiary of Cleveland-Cliffs Inc.
Cliffs announced Oct. 11 that it would purchase the company for approximately $775 million.
FPT, which was recently awarded Fastmarkets’ 2021 Scrap Company of the Year, is a leading prime ferrous scrap processor in the United States. FPT currently processes approximately 3 million tons of scrap per year, approximately half of which is prime grade. Cliffs says it expects to grow its prime scrap presence through its existing relationships with industrial steel consumers.
FPT operates 22 scrap processing facilities, with approximately 90 percent of revenue originating from its Midwest locations, primarily in Michigan and Ohio. In the trailing 12 months ended Aug. 31, FPT generated earnings before interest, taxes, depreciation and amortization of approximately $100 million, Cliffs says.
Cliffs Chairman, President and CEO Lourenco Goncalves, says, “The way the scrap business historically worked has now changed for good. With our closing of the FPT acquisition today, we are now immediately focused on amplifying the value of what we believe is the next precious metal. To drive this, we have already begun the dialogue with our steel customers with a focus on increasing our scrap offtake from them under a real closed-loop proposition. We are starting from a position of strength with the existing business that FPT has in place and are excited to expand upon this core using the FPT scalable footprint.”