Feb 18 (Reuters) – Media billionaire Kerry Stokes-owned SGH Ltd and U.S.-based Steel Dynamics raised their takeover offer for BlueScope Steel to A$15 billion ($10.62 billion), in a “best and final” bid to buy the Australian steelmaker.
Shares of the Melbourne-based steel producer jumped as much as 5.5% in early trading to A$29.55.
SGH and Steel Dynamics on Wednesday said they will now pay A$32.35 per BlueScope share in cash. That excludes the dividends BlueScope announced recently, and is 8% higher than the prior bid of A$30 a share, which was rejected as “undervaluing” the company.
The new offer represents a premium of 15.5% to BlueScope’s last closing value of A$28.00 on Tuesday.
“The increased purchase price represents SGH and Steel Dynamics’ best and final offer in the absence of a superior competing proposal for all or a material part of BSL,” the parties said in a joint announcement.
BlueScope said it was “considering and evaluating the proposal relative to the fundamental value of the company”.
AustralianSuper, the steelmaker’s top shareholder with a 13.52% stake, did not immediately respond to a Reuters request for comment. It backed BlueScope last month in rejecting the prior offer, saying it “very significantly undervalued” the company.
SGH and Steel Dynamics on Wednesday maintained their plan to break up the Australian steelmaker along geographic lines — SGH would take the Australian operations and Steel Dynamics would get the North American unit.
Indiana-based Steel Dynamics has assets some 90 kilometres, or 50 miles, from BlueScope’s plant in Ohio.
The proposal, first made in December, marked the latest attempt by Steel Dynamics to buy Australia’s largest steel producer, and comes as the sector grapples with U.S. President Donald Trump’s tariffs on steel imports.
Earlier in the week, BlueScope announced an interim dividend of 65 Australian cents per share after reporting better-than-expected first-half earnings and robust second-half performance. Last month, it announced a special dividend of A$1 per share.
($1 = 1.4118 Australian dollars)
(Reporting by Sameer Manekar in Bengaluru; Editing by Alan Barona)
