Liberty eyes US IPO after closing on Keystone

Liberty Steel USA is planning an initial public offering (IPO) following its acquisition of Texas-based steel wire and bar producer Keystone Consolidated (KCI).

The $320mn KCI purchase "helps pave the way towards a proposed US IPO of Liberty Steel USA," the New York-based steelmaker, a subsidiary of London-based industrial group GFG Alliance, said this week.

Details on the valuation of the business and proposed timeline for the process, to be led by investment bank Credit Suisse, were not yet available, a company spokesperson said.

The acquisition of KCI gave Liberty a 1.1mn st/yr electric arc furnace in Peoria, Illinois, as well as a wire rod facility, a bar mill and three wire mesh facilities. The purchase followed the acquisition of the idled Georgetown Steel wire rod mill in Georgetown, South Carolina, from ArcelorMittal in late-2017.

The KCI and Georgetown mills provide Liberty Steel USA with a combined 1.8mn st/yr of melting capacity, 2mn st/yr of wire rod rolling capacity as well as downstream businesses. The business will have 1,300 employees and operations in Illinois, Ohio, South Carolina, New Mexico, Texas and Georgia.

"The long history, strong management, excellent work force and industry position of KCI will pair well with our existing Georgetown plant and will serve as a strong base for our continued expansion to 5mn st/yr of steel capacity [in the US by 2020]," GFG executive chairman Sanjeev Gupta said.

GFG's US recycling assets are not slated to be included in the public offering. The company's Liberty Recycling subsidiary acquired Tampa, Florida, scrap recycler Export Metals in early 2018. The purchase was the first in what Liberty said will be an "extensive network" of scrap collection and processing facilities designed to support its steel manufacturing operations.

The planned US IPO also follows an active year for GFG in Europe.

The company in November completed the $500mn acquisition of the 270,000 t/yr Aluminium Dunkerque Smelter in northern France, Europe's largest, from mining group Rio Tinto. The closing came after GFG acquired French aluminum wheel manufacturer AR Industries earlier in the year.

GFG also agreed to acquire as many as seven steel mills across Europe from ArcelorMittal as part of a divestment package the integrated producer agreed to with the European Commission to facilitate its acquisition of Italian steelmaker Ilva, among other smaller deals.

GFG Alliance operates companies in the energy generation, metal manufacturing, engineering, natural resources and financial services industries. The group has a global staff of 14,000 and $15bn in annual revenue.