SGH-Steel Dynamics eye BlueScope takeover
Australia’s BlueScope Steel has confirmed receiving an unsolicited takeover approach, responding to recent media speculation around a potential bid for the Australian steelmaker, Kallanish notes from an ASX filing.
In the 5 January statement, BlueScope Steel says it received a non-binding and indicative proposal on 12 December 2025 from an Australian-US consortium to acquire all BlueScope shares via a scheme of arrangement at AUD 30 ($20) per share in cash.
The consortium comprises SGH Limited and US-based steel producer Steel Dynamics. Under the proposal, SGH would acquire BlueScope in full and subsequently divest BlueScope’s North American operations to Steel Dynamics.
BlueScope says the indicative proposal is subject to multiple conditions, including exclusivity, due diligence, no material adverse change, unanimous board recommendation, shareholder approval, regulatory clearances, and the absence of further share buybacks. The proposal also includes highly conditional debt funding arrangements.
The BlueScope board, together with management and advisers, is currently evaluating the proposal against the company’s fundamental value, the steelmaker notes.
Key considerations include BlueScope’s resilient earnings base and expectations of rising cash flow as major capital projects conclude. As well as the AUD 2.3 billion ($1.54 billion) investment programme targeting an additional AUD 500 million/year in earnings by 2030, and the latent value of its 1,200-hectare land portfolio, highlighted by the recent West Dapto transaction.
The company also disclosed that it had previously rejected three separate unsolicited approaches. In late 2024, a Steel Dynamics-led consortium made offers at AUD 27.5 and AUD 29 per share for all of BlueScope.
While in early 2025 Steel Dynamics proposed a complex transaction that would have separated BlueScope’s North American at AUD 24 per share and distributed the non-North American assets to BlueScope shareholders at least AUD 9 per share.
BlueScope says these approaches materially undervalued the group and carried significant execution and regulatory risks. It emphasises that shareholders are not required to take any action at this stage.
The company has appointed UBS as financial adviser and Herbert Smith Freehills Kramer as legal adviser. It says it will continue to update the market in line with its disclosure obligations.
Thyssenkrupp to cooperate with BlueScope on low-carbon steel research
The focus of the joint research will be on smelting units and direct-reduced iron (DRI) plants, it added.
The cooperation between the two companies will continue for four years, intended to enhance the understanding of smelting technologies and to optimize the management of Thyssenkrupp’s new DRI complex in Duisburg, now under construction.
BlueScope Steel has already gained experience in these technologies by operating smelters in New Zealand using DRI made from iron sand, Thyssenkrupp said.
Thyssenkrupp already had plans to replace one of the four blast furnaces at its Duisburg site with a DRI plant and two downstream smelters in 2027, a company spokesperson told Fastmarkets. This would allow the company to make its first steps toward carbon-neutral steel production, Thyssenkrupp added.
The other three BFs will gradually be replaced with climate-friendly alternative technologies by 2045, the spokesperson told Fastmarkets.
The new plant will have capacity for 2.5 million tonnes per year of DRI. The company also planned to be able to produce around 5 million tpy of low-carbon steel by 2030.
Thyssenkrupp has obtained €2 billion ($2.2 billion) in German state funding for its green steel transformation project.
The DRI module at Duisburg will be powered by green hydrogen, which is seen as a strategic renewable fuel in Europe.
According to the hydrogen import strategy approved by the country’s Federal Cabinet at the end of July, demand for hydrogen and hydrogen derivatives in Germany will amount to 95-130TWh in 2030.
“In the smelters, DRI and aggregates are melted to form hot metal,” Thyssenkrupp said. It added that two identical smelters, each electrically powered and with capacity for 100MW, were being built to process the 2.5 million tpy of DRI output.
Thyssenkrupp added that, ideally, renewable electricity would be used to power the smelters.
“The smelters offer numerous advantages in an integrated metallurgical network,” Thyssenkrupp said. “They enable the production of equivalent ‘electric furnace iron’ while all other process stages, including the steel mill, remain in place, and [further] investments in plants and equipment are minimized.”
The company added that, by retaining all processes from the steel mill stage onward, Thyssenkrupp would continue to provide its customers with “the entire range of steel grades in the usual high quality.”
According to the company, the use of a smelter offers a flexible raw material basis, since DR pellets can also be used in the DR plant.
Another advantage of this technology was that the molten slag could be processed further and used in the cement industry, thus contributing to recycling management.
Demand for green steel remains slow in Europe
Demand for flat green steel was still sporadic in Europe. This was a result of both seasonal factors and relatively low green steel uptake across supply chains, industry sources have told Fastmarkets.
During the assessment week ended August 15, offers of green steel with Scope 1, 2 and upstream Scope 3 carbon emissions of less than 0.8 tonnes per tonne of steel were reported at €200-350 ($221-386) per tonne from European suppliers, stable week on week.
But due to the slow demand, producers were apt to give discounts. As a result, a booking of flat steel with carbon emission content of around 0.6-0.8 tonne per tonne of steel was reported at €170-200 per tonne in late July/early August.
Fastmarkets’ latest weekly assessment of the green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe, was €170-200 per tonne on August 15, narrowing downward from €170-250 per tonne seven days earlier.
