CMC Bids for Croatian Mill

Commercial Metals International, a subsidiary of Commercial Metals Co., is seeking to acquire "Zeljezara Split" d.d. Kastel Sucurac (Split) from the Croatian Privatization Fund. Split is an electric arc furnace steel reinforcing bar mill with a wire mesh facility. The bid is around $28 million, which does not include additional working capital requirements for increasing production levels.

This is the second of Croatia's two operating steel mills for which CMI has submitted a purchase offer. Earlier this year, CMC announced that CMI had submitted a bid for the Valjaonica Cijevi Sisak pipe mill. However, bids for that mill were rejected by the Fund, which has requested new bids by April 17. CMC expects to rebid on the Sisak mill.

According to CMI, a total of six bids have been made for the Split mill. The Croation steel mill has a capacity of around 170,000 metric tons of rebar capacity, along with 30,000 tons of mesh capacity. The company has about 70,000 metric tons melting capacity and about 300,000 metric tons of tubular manufacturing capacity in its existing product line which include seamless, welded and cold processed pipe.

Hanns Zoellner, president of CMC's Marketing and Distribution segment, stated, "We are very excited about the prospects for Split and look forward to promptly commencing discussions with the Fund to conclude a purchase contract. We know the rebar business as CMC is the third largest manufacturer in the United States and with the experience and success we have enjoyed following the acquisition of a majority interest in CMC Zawiercie, our Polish mill, we are confident we can achieve the same results in Croatia at Split. Even more exciting is the possibility that CMC will also acquire the Sisak mill.