Steel Dynamics Completes Acquisition of Mexican Metal Recycler Roca Acero

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Steel Dynamics ($NASDAQ:STLD), Inc. is one of the largest steel producers in the United States. The Company’s operations are located throughout the United States, and along with its joint ventures, Steel Dynamics produces a wide range of steel products, including flat-rolled steel, structural steel, rail, engineered bar, coiled rebar, hot-rolled steel bar, cold-finished steel bar, merchant bar, automotive steel and specialty metals. The Company also produces welded steel tube, plate, grating, expanded metal and grid products. Combined with Steel Dynamics’ existing Mexican metals recycling business, total estimated ferrous and nonferrous scrap processing capability within Mexico will exceed 2.5 million gross tons per year.

The acquisition of Roca Acero allows Steel Dynamics to vertically integrate its operations and procure raw materials at a lower cost. It also provides the Company with a strategic foothold in the Mexican market, which is expected to continue to grow in the coming years.

Market Price

On Tuesday, STEEL DYNAMICS stock opened at $76.1 and closed at $78.0, up by 3.5% from its previous closing price of $75.4. The move comes as Steel Dynamics looks to expand its operations in the growing Mexican market. The acquisition is expected to be immediately accretive to Steel Dynamics’ earnings per share, and the company is expecting to realize significant cost synergies over the next two years. Steel Dynamics is well-positioned to continue its strong performance in the months and years ahead.

VI Analysis

STEEL DYNAMICS is a company with strong fundamentals, reflected in its high health score of 8/10 on the VI Star Chart. The company is cashflow and debt-safe, meaning it is capable of riding out any crisis without the risk of bankruptcy. Furthermore, STEEL DYNAMICS is strong in asset, dividend, and growth potential, making it a good investment for those seeking high capital gains. However, the company is only medium in profitability, meaning that investors should be aware of the potential for lower returns in the event of an economic downturn.

Summary

Steel Dynamics, Inc. announced today that it has completed the acquisition of Mexican metal recycler Roca Acero. Roca Acero is a leading scrap metal recycler in Mexico with operations in Monterrey, Reynosa, and Puebla. The company plans to invest additional resources to grow the business and maximize its potential.

The stock price of Steel Dynamics moved up on the news of the acquisition. This is due to investors anticipating that the company will be able to grow its business and generate more profits as a result of the expansion into the Mexican market.