Nov. 11, 2015
Cargill Sells Stake in North Star BlueScope
Cargill has reached an agreement to sell its interest in North Star BlueScope Steel LLC to joint venture partner BlueScope Steel, based in Melbourne, Australia. Through the transaction, BlueScope will pay $720 million in cash for Cargill's equity stake in NSBS and will assume $40 million of NSBS debt.
"North Star has delivered consistent financial performance and strong returns on invested capital to BlueScope,” says Paul O'Malley, BlueScope managing director and CEO. “This transaction will give us 100 percent ownership of an asset that is highly regarded within the U.S. steel sector. Full ownership enhances BlueScope's portfolio value and optionality and improves business flexibility."
NSBS is currently a 50-50 joint venture between The Woodlands, Texas-based Cargill and BlueScope. Since 1997, the joint venture has operated a steel minimill in Delta, Ohio, producing over 2 million tons of hot-rolled steel coils annually. NSBS is Cargill's lone remaining steel production investment, with the company having sold its North Star Steel unit in 2004.
"Cargill has been pleased with the performance of the NSBS team in Delta and the financial results of the joint venture. We have chosen to sell our interest in the joint venture to redeploy this capital elsewhere in Cargill's portfolio and are confident in the team's continued success under new ownership,” says Peter Hawthorne, Cargill vice president of strategy and business development and chair of the joint venture's board of directors.
Cargill, the 21st-largest service center in the latest Metal Center News Top 50, will remain involved in metals distribution through its Metals Supply Chain Business.