Russian steel company OAO Severstal announced today it is selling its U.S. steel plants in Dearborn and Columbus, Ohio for $2.3 billion to AK Steel Corp. and Steel Dynamics Inc., respectively.
The company, collectively known as Severstal North America, is selling its Dearborn plant for $700 million to AK Steel Corp. in West Chester, Ohio. Steel Dynamics, based in Fort Wayne, IN, will pay about $1.6 billion for Severstal Columbus.
The sale of the two plants will allow Severstal to realize more value for the U.S. assets than was reflected in the company’s share price, benefitting Severstal as well as the plants, says Alexey Mordashov, CEO of OAO Severstal.
“The sale of Columbus and Dearborn unlocks substantial value to Severstal’s shareholders,” Mordashov says.
The work to prepare and sign the agreements to sell the assets was launched at the end of 2013, and is expected to be completed by the end of this year. The boards of both companies have approved the sale.