United States Steel, Pittsburgh, announces that it has formed a joint venture partnership agreement under which it has taken the first step toward acquiring Big River Steel through the purchase of a 49.9% ownership interest at a purchase price of approximately $700 million in cash, with a call option to acquire the remaining 50.1% within the next four years.
Big River operates a LEED-certified, Flex Mill in northeast Arkansas that is the newest and most advanced flat-rolled mill in North America. Big River’s technological leadership allows it to produce a wide product spectrum, including advanced automotive steels and electrical steels, for the automotive, energy, construction, and agricultural industries. Big River’s recently announced Phase II-A expansion is expected to double the mill’s hot-rolled steel production capacity to 3.3 million tons annually, establishing it as one of the largest EAF-based flat-rolled mills in North America.
“Our new partnership with Big River is designed to accelerate our strategy to offer our customers the ‘best of both’ by bringing together the capabilities of integrated and mini mill steel production,” said David B. Burritt, President and Chief Executive Officer of U. S. Steel. “Big River operates the most advanced, state-of-the-art and sustainable mill in North America, and our investment would ultimately strengthen our competitive positioning in highly strategic steel-end markets, creating an unmatched value proposition for our stakeholders.”
This transaction provides numerous strategic and financial benefits to U. S. Steel, some of which will begin to be implemented immediately upon the closing of this transaction, while others would become fully realized upon full ownership of Big River. It strengthens U. S. Steel’s competitive positioning, and establishes an unparalleled product platform in strategic, high-margin end-markets, including energy, infrastructure, and automotive.
