ArcelorMittal and Bekaert are investing in a Dramix® steel fibre plant in Costa Rica, as part of an agreement announced in December 2013 between ArcelorMittal, the world’s leading steel and mining company, and Bekaert, global market and technology leader in steel wire transformation and coatings. Having worked together in the region since 1975, the companies have reached a zero-cash agreement involving the mutual exchange of shares in Brazil, Ecuador and Costa Rica.
In Brazil, ArcelorMittal is transferring a 55% stake in its Belgo Bekaert Arames (BBA) ropes plant in Osasco (São Paulo state) to the Bekaert group. Bekaert Cimaf Cabos Ltda will now be wholly owned by Bekaert, while BBA will continue to supply rope wires as semi-finished products. This transaction does not change ArcelorMittal’s control of the shareholding structure of BBA, a partnership established with Bekaert in Brazil in 1997.
In Costa Rica, where ArcelorMittal is the market leader with a production of 370,000 tonnes per year of long carbon steel for the construction, manufacturing and agricultural industries, the agreement involves the drawn wires business. It excludes the company’s steel production business (100% controlled by ArcelorMittal). In the drawn wires segment, the respective shareholding will be 27% (ArcelorMittal) and 73% (Bekaert), including the existing steel wire plant and a new Dramix® steel fibres plant which will start production in the second quarter of 2014. Initial batches will use wire rod produced by ArcelorMittal Monlevade, in Minas Gerais state (Brazil), and later on by ArcelorMittal Point Lisas (Trinidad & Tobago), strengthening downstream operations and increasing the company’s competitiveness in the region.
In Ecuador, ArcelorMittal will take a 27% participation in Ideal Alambrec, a steel wire business controlled by Bekaert. ArcelorMittal’s presence in Ecuador, through this joint venture, will create a new market for the company in the region.
“This new business configuration in Latin America opens up new opportunities to Bekaert and ArcelorMittal”, said Augusto Espeschit de Almeida, CEO of Belgo Bekaert Arames (BBA), a partnership between the groups in Brazil and controlled by ArcelorMittal.