ThyssenKrupp says it may build a steel plant in North America if it is unable to expand its automotive operations here by acquiring an existing steel maker.
The German supplier has agreed to purchase Canadian steel maker Dofasco Inc. from rival Arcelor S.A., of Luxembourg. The deal was part of Arcelor's strategy to avoid a hostile takeover bid from Mittal Steel. Arcelor later accepted that bid, thus halting indefinitely ThyssenKrupp's purchase of Dofasco.
If it can't buy Dofasco, ThyssenKrupp says, it instead will build a steel plant in North America.
"Dofasco would have been a good basis for our plans," says ThyssenKrupp spokesman Erwin Schneider. "But we also could build up our own capacity. This summer, we will present a greenfield solution to the supervisory board."
That presentation likely will be given at the next supervisory board meeting in mid-August.
In January, ThyssenKrupp lost a bid for Dofasco to Arcelor. At the time, Arcelor was trying to fend off a hostile takeover by No. 1 steel maker Mittal, of London. To squash concerns that the deal with Arcelor would give it an overriding market presence, Mittal said it would sell Dofasco to ThyssenKrupp if it acquired Arcelor.
The price for Dofasco, of Hamilton, Ontario, would be $68 Canadian per share (about $60 at current rates), which was ThyssenKrupp's final offer in January. Arcelor paid $71 Canadian per share, or $62.65, for Dofasco.
Although Mittal and Arcelor have since agreed to merge, the sale of Dofasco to ThyssenKrupp hasn't happened. "We have said we want to keep Dofasco, and that statement hasn't changed," an Arcelor spokesman said.
Arcelor has made it difficult to sell Dofasco by placing it under the wings of a foundation based in the Netherlands. "The decision is hanging on the agreement between Arcelor and Mittal," Schneider says.
ThyssenKrupp is determined to expand in North America. "We now have a market share of 1 percent in North America, and we aim for 5 percent," Schneider says. He says ThyssenKrupp wants to offer galvanized and cold-rolled steel and tailored blanks in the United States.
Dofasco spokesman Bill Gair declined to comment on a ThyssenKrupp takeover, saying, "Those are questions better asked of Mittal and Arcelor." Mittal did not respond to phone calls and e-mail messages.
You may e-mail Jens Meiners at [email protected]