Gerdau, Brazil’s largest steel producer, announced the sale of its operations in Colombia and the Dominican Republic with the aim to focus on its asset optimization strategy and long-term growth.
Gerdau will invest in projects designed to increase the competitiveness of its operations in other, more relevant markets and expand its presence in long, flat, and special steel in the Americas, sharing value with its clients, investors and other stakeholders.
“The sale of the long steel operations in Colombia and the Dominican Republic is aligned with Gerdau’s capital allocation strategy, focusing on growth and the competitiveness of the assets with higher long-term value creation potential,” says Gustavo Werneck, Gerdau’s chief executive officer.
The transaction, which will have a base price of $325 million, comprises the sale of its entire stake of 49.85 percent in the Diaco S.A. joint venture (and its subsidiaries) and 50.0 percent in the Gerdau Metaldom Corp joint venture (and its subsidiaries), whose main operations are located in Colombia and the Dominican Republic, respectively, to the INICIA Group, which is currently a partner of the company in said operations. The sale is subject to the usual conditions precedent for transactions of this nature, in particular approval by Colombia’s antitrust authority.
