Germany-based steelmaker ThyssenKrupp has announced that it has reached agreement for the sale of its CSA Siderúrgica do Atlântico (CSA) steel plant in Brazil to Latin American steel producer Ternium. The purchase value is €1.5 billion. The two parties aim to close the transaction by September 30 this year.
ThyssenKrupp stated that, with the sale of CSA, it is parting fully with its Steel Americas division. With the closing of the transaction the company will receive a clear cash inflow which will significantly reduce its net financial debt.
In 2005, ThyssenKrupp decided to expand its steel business into the Americas. The original plan was to produce slabs at low cost in Brazil and process and sell them in the US and Europe. However, following a significant increase in construction costs for the facilities in Brazil and Alabama in the US as well as technical problems with the ramp-up of the plants and high start-up losses, ThyssenKrupp placed the entire project under review. To date Steel Americas has cost the company over €12 billion in capital expenditures and start-up losses.