Gerdau to sell Brazilian power units to Kinross for $255 mln
Gerdau has entered into a deal with Kinross Brasil Mineração to sell its two hydroelectric plants in Brazil’s mid-western Goiás state for 835 million Reais ($255 million), as a further step in its strategy to focus on profitable steel assets, it said late on Wednesday February 14.
The Caçu and Barra dos Coqueiros hydroelectric power units, which started operations in 2010, have total capacity of 155 MW.
The transaction with Kinross Brasil Mineração, a wholly-owned subsidiary of Canadian mining company Kinross Gold Corp, is subject to regulatory clearances and customary closing conditions, the Brazilian steelmaker said.
“The hydroelectric power plants divestment is one more important step in our divestment plan, aligned with the strategy to focus on our most profitable assets in the steel segment,” chief executive officer Gustavo Werneck said in a statement.
Gerdau is conducting an assets sales programme and has raised 6 billion Reais from divestments in the past four years, including the deal with Kinross, it said.
This year, the company announced the sale of its wire rod mill and two downstream facilities located in Texas, United States, to Optimus Steel, as well as the sale of some of its rebar production units in the US to Commercial Metals Co (CMC).
Gerdau is a leading producer of long steel in the Americas and one of the largest suppliers of special steel in the world.
In Brazil, where the firm is based, Metal Bulletin’s monthly price assessment for Brazilian rebar was 2,200-2,400 Reais per tonne delivered on Friday February 9, stable on a monthly basis.