Spanish long steelmaker Megasa has made official a revised offer for the acquisition of Spanish steelmaker Gallardo Balboa, Kallanish notes.
In a note to state-owned news agency EFE, Megasa says it is interested in all of Gallardo Balboa’s assets and plans to maintain the activity of all subsidiaries to give continuity to employees. It also plans to maintain the firm’s headquarters in the Extremadura region.
According to market analysts, Megasa is in this way matching the bid made last week for Gallardo Balboa by Spanish holding Grupo Industrial Cristian Lay (see Kallanish passim).
“We sent a new offer to US investment fund KKR (Kohlberg Kravis Roberts), the current owner of Gallardo Balboa, that includes the acquisition of 100% of the steelmaker’s shares,” Megasa says. “With this improvement the company aims to resolve the concerns shown by the institutions.”
The longs producer guarantees to settle all Gallardo Balboa’s commitments to creditors, as well as working capital for the normal development of the business and investments in revamping production lines. “The important industrial and commercial synergies that would be created with the merger will allow Megasa and Gallardo Balboa to be more competitive and consolidate in the European steel sector,” Megasa adds.
Grupo Gallardo Balboa declined to comment on the negotiation process. Earlier this week trade unions voiced their support for the bid presented by Cristian Lay as it included all assets of Gallardo Balboa. Following Megasa’s bid revision, though, the Spanish steelmaker could be considered the front-runner in the bidding race for Gallardo Balboa, since it is a major international steel sector player.