MMK announced of the acquisition of a 50% minus one share stake in its 2.3 million tpa Turkish JV with the Atakash family MMK-Atakash for USD 485mn. MMK Atakash is a brand new steelmaking complex in Turkey producing hot- and cold-rolled steel, including galvanised and colour-coated steel.
It is important to note that just before acquisition of the Atakash family stake, MMK announced of commissioning of an electric arc furnace at MMK-Atakash.
The news are definitely positive for MMK, given that the company would now hold 100% stake in a brand-new flat steel producer located in one of the major markets for Russian steel. The total consideration in the deal seems reasonable to us, as it suggests only USD 185 million on top of the initial contribution into equity made by the Atakash family in 2007.
Together with MMK-Atakash’s 2.3 million tpa finished steel capacity, MMK’s total finished steel capacity will be 15.3 million from 2012.