Steel Dynamics Inc. (SDI), headquartered in Fort Wayne, Indiana, announced the completion of its purchase of Zimmer S.A. de C.V. Aug. 3. The acquisition, which was first announced in March, is part of SDI’s raw material procurement strategy to support its new flat-roll electric arc furnace steel mill in Stinton, Texas, which is planned to begin operations in mid-2021. The transaction was funded with available cash, according to the company.
Zimmer is headquartered in Monterrey, Mexico, and operates a ferrous and nonferrous scrap metals recycling business. The company’s primary operations include six scrap processing facilities strategically positioned near high-volume industrial scrap sources throughout central and northern Mexico. The company also operates several third-party scrap processing locations. These combined facilities currently ship approximately 500,000 gross tons of scrap annually and have an estimated annual processing capability of 2 million gross tons, SDI says in a news release announcing the completed transaction.
"We sincerely welcome the Zimmer team into the Steel Dynamics family," says Mark D. Millett, president and chief executive officer of SDI. "Combined with our existing metals recycling presence in Mexico, the acquisition of Zimmer expands our commercial presence in the region and strengthens our raw material supply strategy, allowing for cost-effective ferrous scrap procurement for our new Texas flat-roll steel mill. Zimmer provides a platform to grow our metals recycling presence in Mexico and represents a meaningful achievement in our raw material sourcing strategy for our Texas flat roll steel mill."
SDI’s U.S.-based scrap processing subsidiary, OmniSource LLC, operates a scrap trading office in Mexico, OmniSource Scrap Metals Management of Mexico, S. de R.L. de C.V.