Claymont steel mill owner reaches deal to sell S. African site

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Claymont Steel owner reaches deal to sell S. Africa mill

Claymont mill owner Evraz, PLC has signed a non-binding agreement to sell its 85 percent stake in a South African steel mill.

The potential buyer is the Nemascore (Pty) Ltd, black economic empowerment consortium, which would pay $320 million.

Evraz Highveld is a vertically integrated iron ore steel and vanadium slag producer. Steel and vanadium slag are produced at the integrated steel mill. The mill had a pre-tax loss of nearly $97 million in 2012.

A four-week strike occurred at the steel mill last year and contributed to the loss.

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The two parties expect the transaction to be completed in the second quarter of this year.. The parties have agreed upon a transition period during which Evraz will support the management of Highveld to ensure stable operations and a smooth transfer of the business.

“Evraz Highveld has always been an important investment of the company”, said Alexander Frolov, CEO of Evraz. “Our decision to divest the asset will allow us to enhance the company’s focus on our key steel markets in Russia and North America.

 

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