Outokumpu has completed the divestment of majority of its Long Products business
Outokumpu Oyj
Stock exchange release
January 3, 2023 at 7.40 pm EET
Outokumpu has completed the divestment of majority of its Long Products business
On July 12, 2022 Outokumpu announced the divestment of the majority of its Long Products business, and the company has today completed the divestment to Marcegaglia. The prerequisites for the completion of the transaction were, among others, necessary approvals by the competition authorities, and Outokumpu announced these approvals on December 14, 2022. The transaction was carried out as a share sale, and with the transaction, melting, rod and bar operations in Sheffield, UK, bar operations in Richburg, US, and wire rod mill in Fagersta, Sweden were sold to Marcegaglia. The transaction excluded Outokumpu Long Products AB operating in Degerfors and Storfors in Sweden, which continue as a part of Outokumpu.
“I want to thank the personnel in Sheffield, Richburg and Fagersta for our joint journey as part of Outokumpu. It makes us pleased that the new owner, Marcegaglia, is a responsible and committed owner to develop Long Products business even further. As for Outokumpu, we can now fully focus on our core business of stainless steel flat products and ferrochrome according to our strategy,” says Outokumpu’s President and CEO Heikki Malinen.
The total consideration of the transaction on a debt and cash free basis was approximately EUR 228 million, strengthening Outokumpu’s financial position. Cash proceeds for equity and net debt item are approximately EUR 224 million of which EUR 5 million paid to an escrow account. Transaction costs are estimated to be approximately EUR 7 million. The consideration is subject to closing accounts that are finalized during the first half of 2023.
Outokumpu recognized an impairment loss of EUR 35 million in the third quarter 2022 results and does not expect any material gain or loss on the transaction. The cumulative translation adjustment relating to foreign subsidiaries held for sale will be reclassified into profit and loss at the time of disposal and will impact the gain or loss. These impacts will be refined in financial statements release 2022, which will be published on February 9, 2023. Starting from interim report January–September 2022, Outokumpu has classified its Long Products businesses to be divested as assets held for sale and reports the businesses as discontinued operations.
For more information:
Investors: Linda Häkkilä, Head of IR, tel. +358 400 719 669
Media: Päivi Allenius, VP – Communications and Brand, tel. +358 40 753 7374
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com