BlueScope Steel rejects $8.8B takeover offer

[Ben Graham]

BlueScope Steel (ASX: BSL) has rejected an $8.8 billion takeover bid by US steelmaker Steel Dynamics (NASDAQ: STLD) and Australian conglomerate SGH (ASX: SGH), accusing the bidders of trying to buy the company “on the cheap”.

The company’s board said on Wednesday the proposal failed to properly reflect the value of BlueScope’s assets and came during a period of weaker steel spreads in Asia, conditions it argued masked the company’s longer-term earnings power. It was the fourth approach from Steel Dynamics since late 2024.

“Let me be clear – this proposal was an attempt to take BlueScope from its shareholders on the cheap,” BlueScope Chair Jane McAloon said, adding the board’s position had not changed across multiple approaches.

The board also cited a period of lower steel spreads in Asia as one of the reasons for refusing the offer.

Steel Dynamics and SGH, which is controlled by billionaire Kerry Stokes, offered A$30 ($20.2) a share for the Australian steelmaker. Steel Dynamics would have acquired BlueScope’s North American operations, while SGH would have retained the rest of the business.

BlueScope plays down $8.8B bid from Stokes, Steel Dynamics

Shares in Australia’s largest steelmaker closed up 1.12% at A$29.90 on Wednesday, before the board announced its decision, after jumping nearly 21% a day earlier following news of the bid.

Target

BlueScope has long been viewed as a potential takeover target because of its sizeable North American footprint, which includes five businesses and contributed about 45% of revenue in the 2025 financial year. Its assets include a steel mill in Ohio, about 130 km from a Steel Dynamics-owned facility, as well as a building products division.

The rejection comes as the global steel sector adjusts to a 50% US tariff on steel imports imposed by President Donald Trump on national security grounds. BlueScope operates close to 100 sites across Australia, with its domestic business generating A$6.95 billion in sales last financial year.

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The company is also working with Asian steelmakers, including Japan’s Nippon Steel and Korea’s Posco, to explore a potential acquisition of the Whyalla steelworks in South Australia, previously owned by British businessman Sanjeev Gupta.