NAS to Purchase Haynes
North American Stainless (NAS), a recycled-content metals producer owned by Acerinox S.A. in Spain, has just announced its agreement to gain specialty alloys producer, Haynes International, located in Kokomo, Indiana. NAS seeks to expand operations and broaden its product offerings in the global market.
Acerinox has disclosed that NAS is set to purchase the alloys manufacturer which is said to be worth approximately $798 million in securities, with an added premium that will raise the total transaction amount to around $970 million.
Located in Kentucky, NAS specializes in utilizing primarily recycled materials to produce 800,000 tons of stainless steel annually. NAS is also currently undertaking an expansion initiative to increase its annual production capacity to 1 million tons.
“This is a strategic decision with which Acerinox will increase its positioning in the United States to accompany the expected growth in the American market,” Acerinox CEO Bernardo Velázquez Herreros explained, reiterating that the move “reinforces our leadership in the American market and our commitment to this factory, one of the most efficient in the world. We are proud to produce in NAS about 50 percent of the country’s stainless steel.”
Transaction Specifics
In its latest financial quarter, Haynes International shared that it shipped approximately 2,350 tons of specialty alloys. The aerospace, chemical processing, and land-based gas turbine sectors are the primary industries that Haynes International supplies its alloys to.
It was also noted in the 10-K form filed by Haynes International with the Securities and Exchange Commission, that its melt materials comprise several sources, including virgin raw material, purchased scrap, and internally generated scrap.
When announcing the transaction, Acerinox revealed that NAS expressed its commitment to Haynes by pledging $200 million in capital investments over the next four years for the combined North American business.
VDM Metals
In 2020, Acerinox acquired the VDM Metals facilities, which are now operating under their name, as a part of its joint assets.
“This acquisition is aligned with Acerinox’s key strategic priority of enhancing our focus on value-added products with an emphasis on excellence and sustainability, building on our successful acquisition of VDM Metals in 2020,” Carlos Ortega Arias-Paz, Acerinox Chairman states. “The Haynes team has built a leading high-performance alloys business that will now be supported by Acerinox’s global operating and financial strength.”
Similar to Haynes, VDM specializes in the production of unique alloys, which includes corrosion-resistant and heat-resistant nickel alloys, cobalt and zirconium alloys, as well as specialty stainless steel. Within the United States, VDM manages two specialized alloy facilities, with one located in Nevada and the other in New Jersey.
“Haynes has impressive and complementary business operations, R&D capabilities and an experienced team,” Herreros commented. “[Its] addition to Acerinox strengthens our global leadership in high-performance alloys and creates meaningful opportunities in the high-growth aerospace segment and the attractive U.S. market.”
“By joining with Acerinox, we will be able to continue to grow and enhance our operations, especially with the additional $200 million investment into the combined company’s U.S. operations, including $170 million into our operations with the vast majority invested in Kokomo, Indiana,” Haynes President and CEO Michael L. Shor notes. “We look forward to our people and our local communities realizing the benefits of this transaction.”
