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February 1, 2018

Gerdau to sell its Beaumont wire rod mill to Optimus

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Brazil’s Gerdau S.A. has agreed to sell Optimus Steel LLC its wire rod mill in Texas, and two downstream facilities, for $92.50 million.

A press release said that the deal will include Gerdau’s wire rod mill in Beaumont. The mill has a melt shop capacity of approximately 700,000 tons, and is capable of producing both wire rod and coiled rebar. The sale also includes two downstream facilities: Beaumont Wire Products and Carrollton Wire Products. Beaumont Wire Products. The former was described as a wire mesh mill and the latter as a supplier of industrial wire into the greater U.S. southern region.

The news follow a previous announcement by Gerdau of the sale of four rebar mills and nearly three dozen downstream facilities to Commercial Metals Company for US$600 million. Once the two separate deals close, Gerdau, which was part of a recent trade case seeking to limit the in-flow of low-cost imported wire rod, will be out of that sector.

Gerdau Chief Executive Gustavo Werneck said that the company will “focus on more value-added products.” It will continue to have a considerable presence in North America, with 18 facilities, 15 in the U.S. and three in Canada that produce merchant steel, structural steel and some rebar.

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