Tata Steel fails to clinch deal for IJmuiden steel mill with SSAB
Tata Steel and Swedish steel company SSAB have called off their talks regarding the potential acquisition of the former’s IJmuiden steel mill and associated downstream assets in the Netherlands by the latter.
SSAB, following a deeper analysis and discussions, found that there were few possibilities for integrating the Tata Steel Netherland business into its strategic framework.
The Swedish steel company entered into talks with Tata Steel during the fourth quarter of 2020.
Martin Lindqvist – President and CEO at SSAB said: “We have carefully evaluated Tata Steel IJmuiden and have concluded that an acquisition would be difficult for technical reasons.
“We cannot be sufficiently certain that we could implement our industrial plan with the preferred technical solutions as quickly as we would wish. We cannot align Tata Steel Ijmuiden with our sustainability strategy in the way desired.”
Tata Steel fails to clinch deal for IJmuiden steel mill with SSAB. Photo courtesy of Tata Steel.
According to Martin Lindqvist, the synergies seen by the company in the deal would not totally justify the costs and investments needed for its desired transformation. As a result, the acquisition of the Tata Steel Netherland business would not match the financial expectations of the Swedish firm, said its CEO.
SSAB said that it had started discussions about Tata Steel IJmuiden based on the clear desire of its customers for a strong supplier of a wide range of fossil-free steel.
Tata Steel said that it will continue to pursue a strategic resolution for its European portfolio.
The company stated: “IJmuiden plant is among the most environmentally efficient and cost competitive steel producers in Europe. Currently, around two third of the business of Tata Steel is based in India with best in class, highly cost competitive assets and strong cash flows and Tata Steel remains committed to undertake significant de-leveraging in FY21 and beyond.”
Located on the North Sea coast of the Netherlands, the Tata Steel Ijmuiden steel mill produces organic and metallic coated strip products. The steel mill has basic oxygen steelmaking, hot strip mill, thin strip caster, cold mills, annealing lines, and metallic/organic coating lines.
The steel mill in Ijmuiden, North Holland, owned by Tata Steel, has a production capacity of about 7,500,000 tonnes/year of hot/cold rolled coil.