SYDNEY (Thomson Financial) - Australia's largest steel group BlueScope Steel Ltd said Thursday it has agreed to acquire the outstanding shares of IMSA Steel Corp for 730 million US dollars from the NYSE-listed Ternium SA.
BlueScope chief executive Paul O'Malley said the acquisition will broaden the group's scope and geographic reach in the US.
'The acquisition will significantly develop our downstream North American multi-brand, multi-channel strategy,' O'Malley said.
BlueScope expects to realise about 40 million dollars a year of synergies within three years, he said.
'This acquisition builds on our existing highly successful pre-engineered buildings business, Butler Manufacturing, and makes BlueScope Steel a leader in the North American steel building and construction market,' O'Malley said.
The acquisition is subject to normal regulatory approval and is expected to be completed by early 2008.
ISMA had consolidated group sales of 1.2 billion dollars in the year to December 2006 and earnings before interest, tax, depreciation and amortization (EBITDA) of 86 million dollars.
The acquisition is expected to be earnings per share neutral in the year to June 2008 but earnings accretive in fiscal 2009, BlueScope said.
The acquisition will be funded by a 364 day bridge facility.
ISM has four distinct businesses with manufacturing facilities throughout the US.
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