Gerdau SA To Buy Gerdau Ameristeel For $1.6B

Tampa-based steel producer Gerdau AmeriSteel said majority shareholder Gerdau SA plans to acquire the remaining shares it does not own in a deal valued at $1.6 billion.

TAMPA, Fla. (AP) -- Steel producer Gerdau AmeriSteel Corp. said Wednesday majority shareholder Gerdau SA plans to acquire the remaining shares it does not own in a deal valued at $1.6 billion.

Gerdau AmeriSteel, which is based in Tampa, said Gerdau SA already owns 66 percent of its outstanding shares and intends to buy the rest for $11 per share. It said that represents a premium of 53.4 percent over its June 1 closing price of $7.17.

Gerdau AmeriSteel shares soared $3.94, or 55 percent, to $11.11 in Wednesday morning trading.

RBC Capital Markets was retained to provide an independent valuation and said the share price was fair, according to a statement from Gerdau AmeriSteel. That company's board said it would support a deal at that price.

Gerdau SA, based in Brazil, will fund the deal, which still needs approval from Gerdau AmeriSteel shareholders, with existing cash resources and committed financing.

More in Supply Chain