Gerdau to buy Dominican Republic steel stake for $42 million
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| Published on Saturday, May 26, 2007 |
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By Jeb Blount
RIO DE JANEIRO, Brazil (Bloomberg): Gerdau SA, Latin America's biggest steelmaker, has agreed to buy a stake in Industrias Nacionales CA of the Dominican Republic for $42 million.
Gerdau will acquire 30 percent of Multisteel Business Holdings Corp., the Porto Alegre, Brazil-based company said in a statement. Multisteel Business controls Industrias Nacionales, known as Inca, which makes and sells 400,000 tons a year of reinforcing rod, wire, tubes, beams and other steel products.
"This operation secures the entry of the Gerdau Group in a new consumer market for steel that is in clear expansion," Chief Executive Officer Andre Gerdau Johannpeter said in a statement on Gerdau's Web site. "It is part of our strategy for expansion in the Americas."
Gerdau is expanding in Brazil, the US, Canada, Mexico, Colombia, Peru and Spain to boost profit by increasing its share of markets where it already operates, Chairman Jorge Gerdau Johannpeter said. Gerdau plans to help Inca increase investment and will provide management, technical and marketing advice.
Osvaldo Schirmer, Gerdau's chief financial officer, said Thursday in an interview that the company's next purchase wouldn't be in Latin America.
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