Severstal, which operates a flat-rolled steel mill in Columbus, sold three of its U.S. mills to a New York-based investment firm in a $1.2 billion deal, Reuters reported.
The Columbus mill wasn”t part of the deal. The Renco Group, an investment firm with no previous steel holdings, bought plants in Warren, Ohio, Wheeling, W.V., and Sparrows Point, Md.
The deal makes Renco”s new RG Steel unit the fourth-largest producer of flat rolled steel in the U.S. Renco”s assets include vehicle manufacturer AM General, Reuters reported.
Moscow, Russia-based Severstal has been working to pare down its U.S. holdings amid a weak steel market. It is increasing capacity at its newer Columbus facility, however, as it trims away older plants.
Reuters reported Severstal said it will receive $125 million in cash, a $100 million secured note and the repayment of $317 million of third party debt. Renco will also assume various Severstal liabilities totaling $650 million, Reuters said.
The deal is expected to close in March, according to reports.
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