Evraz, TMK Acquire IPSCO’s
Tubulars Business from SSAB
Russian steel company Evraz will continue its expansion in North America with the acquisition of IPSCO Tubulars from Sweden’s SSAB. Evraz will then sell a portion of the new acquisition to fellow Russian steelmaker TMK.

Evraz will acquire IPSCO Tubulars from SSAB for $4.025 billion. Evraz also has an agreement to sell IPSCO’s U.S. tubular and seamless business to TMK for approximately $1.7 billion, while holding onto IPSCO’s Canadian plate and pipe business.

The agreement between SSAB and Evraz involves the sale of 12 tubular locations, including the Regina and Koppel steel mills that directly supply the tubular operations, the Regina coil processing facility and related scrap facilities. IPSCO Tubulars has approximately 3,250 employees.

“Following the successful acquisition of Oregon Steel Mills, this transaction will further enhance Evraz’s existing North American presence in high value-added steel segments. This deal will increase our exposure to the attractive energy and infrastructure sectors throughout the region,” says Alexander Frolov, Evraz’s chairman and CEO.

IPSCO Tubulars was acquired as part of SSAB’s acquisition of IPSCO in 2007 and had sales of $2.4 billion in 2007. 

SSAB will retain the majority of the steel production capacity it acquired as part of its acquisition of IPSCO, including steel mills located in Mobile, Ala., and Montpelier, Iowa, together with four cut-to-length facilities. These facilities have an annual capacity of approximately 2.5 million tons of crude steel production. 

The IPSCO brand is closely associated with the tubular business and is included in the transaction. The retained steel operations will operate as a division within SSAB. SSAB also will retain the right to use the IPSCO brand during a transition period.

“This transaction allows us to focus on our core business—to be a global leader within our high- strength-steel niches. We can further grow and develop our steel operations and expand into new markets. IPSCO Tubulars will get an owner with an interest and focus in the tubular business,” says Olof Faxander, president and CEO of SSAB.

Additionally, TMK will acquire 100 percent of IPSCO Tubulars Inc. and 51 percent of NS Group Inc. TMK and Evraz have also entered into an option for TMK to acquire the remaining 49 percent of NS Group in 2009.

“The acquisition of IPSCO Tubular’s U.S. assets is the latest step in the execution of TMK’s strategic emphasis on further bolstering our offering in the oil and gas sectors, while expanding our geographic footprint,” says Konstantin Semerikov, TMK’s CEO. “The transaction marks the entry of TMK, one of the world’s largest steel pipe and tube makers, into the North American market, the world’s biggest market for OCTG and line pipe. The transaction also broadens TMK’s product mix with a significant position in higher value-added products.”

Nucor Acquires Galamba Metals Group
Nucor Corp., Charlotte, N.C., through its David J. Joseph Co. subsidiary, has completed the acquisition, of Kansas City, Mo.-based Galamba Metals Group. Galamba, founded in 1977, operates 16 full-service scrap processing facilities in Kansas, Missouri and Arkansas (including two automobile shredders), and processes over 500,000 tons annually.

DJJ will operate the Galamba Metals Group facilities under the Advantage Metals Recycling LLC name. Galamba's current employees and management team will remain with Advantage Metals Recycling.

This acquisition represents another step in Nucor's previously announced plan to utilize DJJ as a platform for continued growth in the scrap processing industry.

Nucor claims to be the largest purchaser of ferrous scrap in North America, with total scrap purchases of 22.8 million tons in 2007.

Severstal Agrees to
Buy Sparrows Point
ArcelorMittal has finally found a steel company to take Sparrows Point off its hands. Russian steelmaker OAO Severstal will acquire the Maryland-based tin mill for $810 million.

The sale of Sparrows Point was mandated by the U.S. Department of Justice for antitrust reasons due to the merger of Arcelor and Mittal. ArcelorMittal initially agreed to sell the Maryland facility to a joint venture led by Esmark, though that deal fell through.

Sparrows Point has a capacity of 3.6 million metric tons of crude steel and shipped 2.3 million metric tons of finished steel products in 2007. It is the only integrated producer of flat-rolled steel on the U.S. East Coast and is a major North American supplier of tin-mill products.

“With Sparrows Point, Severstal brings into its U.S. portfolio an asset with significant existing value as well as unlocked growth potential,” says Alexei Mordashov, CEO of Severstal. “This acquisition presents us with an opportunity to enhance productivity at Sparrows Point through our high standards of operational performance and will benefit our existing U.S. businesses.”

Severstal expects substantial synergies with its current U.S. operations in Dearborn, Mich., and Columbus, Miss. With the addition of Sparrows Point, Severstal will also improve its distribution channels and increase its geographic reach as the plant provides direct ocean access and proximity to a number of major U.S. railways and highways, say company officials.

“We remain committed to growth in North America and believe in the long-term promise of the U.S. market. We’re confident that this acquisition will create value for our shareholders while strengthening our U.S. platform as a whole,” Mordashov says.

The United Steelworkers have already given union approval to the acquisition.

“In the search for a buyer, following the unraveling of a previous proposed deal last December, we have always maintained that the union will not reach agreement with a successor unless it includes a long-term business and operational strategy that produces security for our members, their families and our retirees,” says David McCall, chair of the USW bargaining committee for ArcelorMittal in North America. “We now have that at Severstal.”

ArcelorMittal agreed in August 2007 to sell Sparrows Point to E2, a joint venture led by Esmark and including Brazil’s Vale, Industrial Union of Donbass Corp. and Franklin Templeton Investments. ArcelorMittal dissolved that agreement in December, citing E2’s failure to secure financing.

The new deal is expected to close during the second quarter.

EPA Recognizes Copper’s Antimicrobial Properties
The U.S. Environmental Protection Agency has approved the antimicrobial properties of copper alloys, acknowledging that copper, brass and bronze are capable of killing harmful, potentially deadly bacteria. Copper is the first solid surface material to receive this type of EPA registration, which opens the door to a host of potential new applications for red metals.

The EPA registration is based on independent laboratory testing using EPA-prescribed protocols that demonstrate the metals’ ability to kill specific disease-causing bacteria, including Methicillin-resistant Staphylococcus aureus. MRSA is one of the most virulent strains of antibiotic-resistant bacteria and a common cause of hospital- and community-acquired infections.

“This is an exciting breakthrough for the copper industry as a whole,” says Warren Bartel, senior vice president and senior advisor for Luvata Group. “As a leading international metals supplier of copper components and solutions, we see ourselves playing a key role in providing our customers with the materials they will need to take advantage of the antimicrobial qualities of copper alloys.”

Testing under EPA-approved protocols demonstrates that copper, brasses and bronzes are effective against a number of disease-causing bacteria. For example, one study shows that on copper alloy surfaces, greater than 99.9 percent of MRSA “superbugs” are killed within two hours at room temperature.

“When cleaned regularly, antimicrobial copper alloy surfaces kill greater than 99.9 percent of (specific) bacteria within two hours, and continue to kill more than 99 percent of (these) bacteria even after repeated contamination,” the EPA report states. “The use of a copper alloy surface is a supplement to and not a substitute for standard infection control practices; users must continue to follow all current infection control practices, including those practices related to cleaning and disinfecting of environmental surfaces. The copper alloy surface material has been shown to reduce microbial contamination, but it does not necessarily prevent cross contamination.”

Widely publicized statistics from the Centers for Disease Control and Prevention estimate that infections acquired in U.S. hospitals affect two million individuals every year and result in nearly 100,000 deaths annually. The use of copper alloys for frequently touched surfaces, as a supplement to existing CDC-prescribed handwashing and disinfecting regimens, has far-reaching implications, the Copper Development Association believes.

Potential uses include door and furniture hardware, bed rails, intravenous stands, dispensers, faucets, sinks and work stations, which can help reduce the amount of disease-causing bacteria in patient rooms.

“When considering the cost of preventive measures or treatment for these diseases, copper may likely become the low-cost, environmentally friendly solution. Now that the EPA has granted copper official status as an antimicrobial agent, we have only scratched the surface of possible copper applications directly targeted at improving public health,” Bartel says.

Unlike coatings or other materials treatments, the antibacterial efficacy of copper metals won’t wear away; they offer long-term protection. Discussions are ongoing with major hospital equipment manufacturers about the development of appropriate copper-based products, the CDA says.