Steel Dynamics Announces Plan – GuruFocus.com
FORT WAYNE, Ind., May 16, 2022 /PRNewswire/ — Steel Dynamics, Inc. (NASDAQ/GS: STLD) today announced that as part of its North American raw materials sourcing strategy, the company has entered into a definitive agreement to acquire the of ROCA ACERO SA de CV (“ROCA”) to be financed with available cash. ROCA is headquartered in Monterrey, Mexico and operates a ferrous and non-ferrous metal recycling business. ROCA’s primary operations are comprised of four scrap processing facilities, strategically positioned near high-volume industrial scrap sources located in Central and northern mexico. These combined facilities currently ship approximately 575,000 gross tons of scrap per year and have an estimated annual processing capacity of approximately 850,000 gross tons.
“We look forward to adding ROCA to the Steel Dynamics family to further strengthen our Southwest United States region and Mexico growth strategy,” said Mark D.Millet, Chairman of the Board, President and Chief Executive Officer. “Combined with our existing North American metal recycling facilities, the addition of ROCA significantly strengthens our raw materials sourcing strategy in the region. Following the closing of the ROCA transaction and the full integration of our Mexican metal recycling operations, we believe that our Mexican scrap facilities will provide a more significant competitive advantage for our U.S. electric arc furnace steel operations, while by providing a high quality, customer-centric option for our outside scrap customers. We are very happy to welcome and learn from the entire ROCA team.
This transaction is subject to customary closing conditions and receipt of required regulatory approvals.
About Steel Dynamics, Inc.
Steel Dynamics is one of the nation’s largest steel producers and metal recyclers. United States based on estimated annual steelmaking and metal recycling capacity, with facilities distributed across United Statesand in Mexico. Steel Dynamics produces steel products including hot rolled, cold rolled and coated steel plates, structural steel beams and profiles, rails, special grade steel in bars, cold finished steel, merchant rolled products, special steel sections and steel joists and decks. . In addition, the company produces liquid pig iron and processes and sells ferrous and non-ferrous scrap.
This press release contains forward-looking statements about future events, including statements relating to conditions in the national or global economies, steel and recycled metals market conditions, Steel Dynamics revenues, costs of materials purchased , profitability and future profits and the operation of new , existing or planned facilities. These statements, which we generally precede or accompany with typical conditional words such as “anticipate”, “intend”, “believe”, “estimate”, “plan”, “seek”, “project” or “s’ expect”, or by the words “may”, “will” or “should” are intended to be formulated as “forward-looking”, subject to numerous risks and uncertainties, within the protections of the safe harbor of the Private Securities Litigation Reform Act of 1995. These statements speak only as of this date and are based on information and assumptions, which we believe to be reasonable as of this date, about our business and the environments in which it operates. Such forward-looking statements are not guarantees of future performance, and we undertake no obligation to update or revise such statements. Certain factors that could cause these forward-looking statements to materialize differently than expected include: (1) national and global economic factors; (2) global steel overcapacity and steel imports, as well as rising scrap prices; (3) pandemics, epidemics, generalized diseases or other health problems, such as the COVID-19 pandemic; (4) the cyclical nature of the steel industry and the industries we serve; (5) volatility and major fluctuations in prices and availability of scrap metal, scrap metal substitutes, and our potential inability to pass on higher costs to our customers; (6) the cost and availability of electricity, natural gas, oil or other energy resources are subject to volatile market conditions; (7) increased environmental, greenhouse gas emissions and sustainability considerations or regulations; (8) compliance with and changes to environmental and sanitation requirements; (9) significant price competition and other forms of competition from other producers of steel, processors of scrap metal and alternative materials; (10) the availability of an adequate source of scrap metal for our metal recycling operations; (11) cybersecurity threats and security risks to our sensitive data and information technology; (12) the implementation of our growth strategy; (13) litigation and legal compliance; (14) downtime or unscheduled equipment shutdowns; (15) government agencies may refuse to grant or renew some of our licenses and permits required to operate our business; (16) our senior unsecured credit facility contains, and any future financing agreement may contain, covenants which may limit our flexibility; and (17) the impact of impairment charges.
Specifically, see Steel Dynamics’ more detailed explanation of these factors and risks, as well as other factors and risks that could cause these forward-looking statements to differ materially, as discussed in our most recent annual report on Form 10-K under the headings Special Note Regarding Futures – Looking Statements and Risk Factors, in our quarterly reports on Form 10-Q, or in other reports we file with the Securities and Exchange Commission. These are publicly available on the Securities and Exchange Commission’s website, www.sec.gov, and on Steel Dynamics’ website, www.steeldynamics.com under “Investors — SEC Filings”.
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SOURCE Steel Dynamics, Inc.