Turkey's Tosyali in talks to acquire stake in MMK Metalurji
Turkish steelmaker Tosyali is in talks over a stake of between 49-51% in local flat-rolled steelmaking rival MMK Metalurji, sources connected with the Iskenderun steel market tell Steel Business Briefing.
"It's not a done deal, but we're hearing that Tosyali is performing due diligence on MMK Metalurji at the moment for a large stake in the mill," a source in Iskenderun says. Other local market participants confirm that talks are continuing.
MMK Metalurji, the Russian-owned HRC plant in Iskenderun was commissioned as a joint venture with Turkish coal trader Atakas early 2011, before MMK bought out their former partner's 50% stake minus one share for $485 million in September 2011.
Tosyali was not immediately available for formal comment at the time of publishing, while MMK declined to comment on the situation.
MMK Metalurji's has a crude steel capacity of 2.3 million tonnes/year, while Tosyali has a number of steel-related interests in the Iskenderun area, including its own 2 million t/y HRC capacity mill. Tosyali also produces billets, pipe and a range of construction steels.
For much of the last two quarters, diversified Turkish mills have focused as much as possible of their output on long-rolled steel due to favourable market conditions in the sector, SBB notes.
MMK Metalurji is purely a flat-rolled steel producer. Another Turkish HRC electric arc furnace mill has reduced its HRC output in recent months in response to the narrowing margin between raw material costs and end product prices.