SSAB has concluded discussions with Tata Steel over the possible acquisition of the IJmuiden steelworks. After deeper analysis following talks that began last November, SSAB says there were limited possibilities to include the Dutch works into its strategic framework.
“We have carefully evaluated Tata Steel IJmuiden and have concluded that an acquisition would be difficult for technical reasons,” SSAB chief executive Martin Lindqvist says in a note seen by Kallanish. “We cannot be sufficiently certain that we could implement our industrial plan with the preferred technical solutions as quickly as we would wish. We cannot align Tata Steel Ijmuiden with our sustainability strategy in the way desired.”
“The synergies that we saw in the transaction would not fully justify the costs and investments required for our desired transformation. This means that overall, the transaction would not meet our financial expectations,” he adds.
The possible purchase of IJmuiden was driven by SSAB customers’ desire for a strong supplier of a broad range of fossil-free steel, the Swedish steelmaker observes. “Through an expanded range of steel products, which in the long term can be converted to fossil-free products, SSAB can become a more comprehensive supplier of fossil-free steel to existing and new customers in key segments,” it continues. “This has also been about creating synergies between existing operations in the Nordics and in IJmuiden and getting closer to the European market.”
The group’s goal is to be the first in the world, in 2026, to supply fossil-free steel to market and to be a fossil-free company by 2045. “We are continuously on the lookout for possibilities to invest and step up the pace of this transition,” Lindqvist concludes.
Tata Steel is expected to continue looking for an investor into IJmuiden after it commenced in November the separation of the Tata Steel Netherlands and Tata Steel UK businesses. The firm has said it will concentrate investment in its Indian operations going forward. It meanwhile remains in talks with the UK government to secure the long-term future of the Port Talbot steelworks.