FORT WAYNE, INDIANA, September 9, 2002—Steel Dynamics, Inc. (NASDAQ: STLD)
today announced that it has completed the purchase of Qualitech Steel
SBQ LLC’s special bar quality mini-mill assets located in Pittsboro,
Indiana. Steel Dynamics paid $45 million for these assets.
Steel Dynamics previously announced plans to invest between $60 and
$70 million of additional capital to convert the Qualitech facility to
the production of merchant bars and shapes and reinforcing bar products.
The company does not currently plan to produce special bar quality
(SBQ) products when the facility is restarted, but has not ruled out the
possibility of producing SBQ products there in the future.
“Acquiring this mill fits our strategy of pursuing product growth and
diversification,” Keith Busse, SDI’s president and chief executive
officer, said. “We feel that we have acquired a nearly-new Indiana
production facility at a very reasonable cost, and, with our planned
reconfiguration costs, it should enable us to enter the merchant bar and
shapes market as a low-cost producer of these products.”
On August 19, 2002, the Hendricks County, Indiana, Superior Court
denied a request by Nucor Corporation to preliminarily enjoin
Qualitech’s sale to SDI, finding that Nucor had little chance of
prevailing on its claim that it had an earlier and enforceable purchase
agreement to buy the Pittsboro mill. Nucor has appealed that ruling. In
light of the trial court’s ruling, however, Steel Dynamics has elected
to close the transaction and to begin the process of engineering work
and conversion planning. The company also intends to proceed with the
preparation and filing of the necessary environmental air permit
application.
Most of SDI’s additional investment is expected to occur in 2003.
Current plans are to complete the conversion during the fourth quarter
of 2003. After conversion, the facility is expected to have a capacity
of 500,000 to 600,000 tons per year.
Steel Dynamics manufactures a variety of hot- and cold-rolled steel
products at its Butler, Indiana, flat-roll mini-mill and has recently
begun initial beam production at its new Columbia City, Indiana,
structural steel and rail facility.
For more information about Steel Dynamics, Inc., please visit www.steeldynamics.com.
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