ThyssenKrupp, Germany’s biggest steelmaker has made a friendly 3.5 billion euro offer for Dofasco, Canada’s biggest steel maker by sales. The bid tops a hostile bid by Luxembourg’s Arcelor SA.
The deal, which had been unanimously recommended by Dofasco’s Board, was expected to close before the end of the first quarter of 2006, according to ThyssenKrupp. The offer represented a 9.8 percent premium over Acelor’s bid, the world’s second-biggest steelmaker.
Posting disappointing quarterly results in October, Dofasco sells a third of its steel to the automotive marker, while the balance of its steel products are supplied to the construction, energy and manufacturing industries. Based in Hamilton, Ontario, Dofasco produces around 5.5 million tons a year of flat steel for the automotive market. U.S., automakers Ford and GM have posted huge third-quarter losses and are scaling back production in response to high labor and raw material costs, overcapacity and competition from Asian and European manufacturers.