GFG Australia unit to buy GFG U.S. steel assets
MELBOURNE — InfraBuild, an Australian steel and recycling unit of troubled global industrial firm GFG Alliance, plans to acquire three U.S.-based businesses from its parent which is undergoing broad restructuring, it said on Thursday.
GFG Alliance, owned by commodities tycoon Sanjeev Gupta, has been scrambling to arrange refinancing for its cash-starved web of businesses in steel, aluminum and energy after supply chain finance firm Greensill filed for insolvency in March last year.
InfraBuild said it plans to raise new finance through debt markets to acquire Keystone Consolidated Industries in Ohio and New Mexico, Johnstown Wire Technologies in Pennsylvania and Ohio and Georgetown steelworks South Carolina from its parent company. It didn’t disclose a value for the deals.
The capital raised will also support the liquidity of the businesses, it said in a statement, with the deal expected to close in the second half of the 2023 financial year.
InfraBuild already has international recycling facilities in Louisiana and Florida and expects to benefit from market growth driven by the U.S. Infrastructure Investment and Jobs act, it said.
The steelmaker, which is ringfenced from its parent company, logged A$197 million ($132.74 million) in earnings before interest, taxes depreciation and amortization in the first quarter of the current financial year, up 24% on the same period a year earlier, it said.
The announcement comes after GFG’s Liberty Steel unit, which has operations in Britain, Europe, the United States, Australia, and Asia, said it had reached agreement to restructure much of its debt on Tuesday.
($1 = 1.4841 Australian dollars) (Reporting by Melanie Burton; Editing by Kenneth Maxwell)
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