Renco to Buy Severstal’s Warren, Wheeling and Sparrows Point facilities
03/03/2011 - The Renco Group signed a definitive agreement to purchase Severstal North America operations at Warren, Ohio, Wheeling, W.Va., and Sparrows Point, Md.
The Renco Group, Inc. has signed a definitive agreement to purchase Severstal North America operations at Warren, Ohio, Wheeling, W.Va., and Sparrows Point, Md.
Severstal will receive $125 million in cash for its Warren, Wheeling and Sparrows Point assets, as well as a $100 million secured note, and the repayment of $317 million of third-party debt at closing. Renco will also assume various Severstal financial liabilities including employee-related and environmental liabilities totaling $650 million.
The sale will leave the remainder of Severstal North America focused on its Dearborn and Columbus facilities.
“The sale of Warren, Wheeling, and Sparrows Point marks a strategic refocusing of our North American operations,” said Sergei Kuznetsov, CEO of Severstal International. “The sale of these assets will enable Severstal North America to evolve into a stronger and more focused organization that is better able to serve our North American customers,” Mr. Kuznetsov concluded.
Evercore Partners and Raymond James and Associates, Inc. are acting as Severstal’s financial advisers, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as Severstal’s legal adviser.
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The transaction is expected to close in March 2011, subject to customary completion conditions, including expiration or early termination of the Hart-Scott-Rodino waiting period.
The Renco Group, Inc. is a family owned, private holding company that makes long term investments in companies across a range of industries including mining, mineral recovery, metals production / fabrication, defense, and automotive supply industries.
