Russia’s Severstal offers £1bn for UK’s largest steel plantBy : Richard Orange
21/02/2007
Pre-empted: Corus’s site at Scunthorpe, which Severstal wishes to acquire
SEVERSTAL, the Russian steel group, has approached Tata Steel with a £1bn ($1.95bn, €1.48bn) offer for Corus’s Scunthorpe plant, Britain’s biggest remaining steelmaking operation.
The move, confirmed by two separate sources, follows Tata’s victory over Brazil’s CSN in the £6.7bn auction for the Anglo-Dutch steelmaker.
It would mark the first entry into British steelmaking for Alexei Mordashov, Severstal’s anglophile chairman, who listed Severstal in London last November, valuing it at £6.5bn.
Russian, Brazilian and European steelmakers are circling amid speculation that Tata will sell Corus’s long products division – which makes steel girders, rods and rails – to pay down some of the £4.4bn it has loaded onto its acquisition vehicle Tata Steel UK. Interested parties include Brazil’s Gerdau, Russia’s Evraz and Arcelor Mittal.
Consultants estimate that about 80% of the value in the long products division resides in the Scunthorpe plant. The remainder is at the Rotherham plant,which makes specialist automotive steel.
Corus’s 2005 annual report estimates the long products division’s total asset value at £1.53bn. Bankers advising potential buyers argue that the division’s debt and relatively low profitability means it will probably sell at a discount of between 50% to 75% of its asset value.
But steel asset valuations have been soaring over the past year, and, given the expected levels of interest, Tata may well be able to extract a much more attractive offer if it decides to sell.
Scunthorpe and Rotherham are completely independent of one another, meaning they could be sold separately. Potential buyers of Rotherham include Alisher Usmanov, the Russian industrialist who attempted a creeping takeover of Corus in 2005.
Corus employs 24,000 people in Britain, at factories in Port Talbot, Teesside, Scunthorpe and Rotherham. Port Talbot produced the most steel in 2006, but Scunthorpe has a higher capacity.
Tata denied that a sale of assets is imminent.
Zo gaat het verder Tata verpatst de boel al voordat ze het hebben.
mvrgr jo jo