Tenaris S.A., the parent company of Italian gas cylinder manufacturer TernarisDalmine, has announced that its Brazilian subsidiary has bought into a leading Brazilian steel producer.
The Tenaris subsidiary, Confab Industrial S.A. (Confab), completed an acquisition of 25 million ordinary shares of Usinas Siderúrgicas de Minas Gerais S.A. (Usiminas).
Usiminas is a leading Brazilian producer of high quality, flat steel products used in the energy, automotive and other industries, while Confab is a leading Brazilian producer of welded steel pipes and industrial equipment for the energy industry and other applications.
The price to be paid for each ordinary Usiminas share is BRL36, representing a total cost to Confab of approximately $500m, says a Tenaris news release.
Under the transaction, Confab will join the existing control group of Usiminas, together with Nippon Steel, Ternium (an associate of Tenaris) and the Usiminas employee pension fund. Confab will thereby have the opportunity to have a higher level of integration with the principal supplier of steel for its pipes and industrial equipment businesses and to develop synergies between its industrial equipment business and that of Usiminas.
This would strengthen Confab’s position as a supplier of specialised pipes and equipment to Brazil’s offshore energy industry. The transaction is expected to close in January 2012, subject to customary conditions and applicable corporate approvals by the Nippon Group.
The Tenaris group is a leading global supplier of steel tubes and related services for the world’s energy industry and certain other industrial applications. TenarisDalmine has long been regarded as the top Italian producer of seamless steel tubes, with more than 3,000 employees and an annual production capacity of 950,000 tons of finished products.
Production activity in Italy takes place at five plants: Dalmine, Arcore, Costa Volpino, Piombino and Sabbio Bergamasco, which produce seamless tubes, cold drawn, welded and gas cylinders. As of early 2010, when gasworld visited the company’s site near Bergamo, its exports accounted for almost 60% of total shipments.
Situated on the edge of Bergamo and prominently positioned at the side of the A4 highway, Tenaris’s gas cylinder division is one of the only vertically integrated cylinder manufacturers of its kind. The Tenaris gas cylinder plant boasted a workforce of 138 people (2009) and manufactures a broad range of high quality gas cylinders, large vessels (jumbo gas cylinders), special products like accumulator shells and cylinders for filling stations, as well as hollows destined for the same applications.