Italian manufacturer Marcegaglia has agreed to acquire Outokumpu's long products division for 228 million euros ($228.1 million). The deal, which represents Marcegaglia's first step into steel production, should be completed by the end of the year.
The deal includes an electric steel mill for the production of special steels, a wire rod mill and a long product plant in Sheffield, UK, a long product plant in Richburg, USA, and a wire rod plant in Fagersta, Sweden. The deal does not include the operations of Outokumpu Long Products AB in Degerfors and Storfors, Sweden.
In 2021, the Long Products Division generated revenue of €810 million and an Ebitda of €47 million. It employs about 700 workers.
Thus, Marcegaglia, one of the world's largest steel processing companies, is taking the first step towards becoming a steel producer by partially integrating its special steel secondary rolling business. President Antonio Marchegaglia told Callanis that the move aims to expand the range of specialty steels, shorten the supply chain and enter international markets in Europe and North America with competitive products.
Now Outokumpu intends to focus on its core stainless steel flat products business. Sales of long products accounted for approximately 8% of Outokumpu Group's revenue in 2021.