Russian steelmaker to buy IPSCO of Canada for $4B

Russian steelmaker Evraz announced March 15 that it will buy Canada's IPSCO for $4 billion.

Evraz is creating a stronger base in North America for downstream steel products, such as steel plates and tubes, the Russian firm said in a statement. IPSCO Inc. makes steel plate, as well as pipes for the gas and oil industry.

"This deal will increase our exposure to the attractive energy and infrastructure sectors throughout the region," said Evraz chief executive Alexander Frolov.

IPSCO became a wholly owned subsidiary of Swedish steel company SSAB in July 2007, after Evraz backed out.

In a separate deal, Evraz said it is selling its tubular business to Russian pipemaker OAO TMK for $1.7 billion.

Evraz last year completed the takeover of Oregon Steel Mills Inc. for $2.3 billion, one of the largest investments in the United States by a Russian company.

Evraz already owns steelworks in the Czech Republic and Italy.

The company also has extensive holdings in Russia's coal mining sector.

Last year, it took control of Yuzhkuzbassugol after two fatal mining accidents, including a methane blast at the Ulyanovskaya mine that was Russia's worst coal mining accident in more than 60 years.

Millhouse Capital, the holding company of billionaire Chelsea soccer club owner Roman Abramovich, has a 36.4 percent stake in Evraz.

IPSCO, which supplies steel to the energy, agricultural and transportation equipment and construction industries, has about 4,300 employees and an annual steelmaking capacity of more than 4 million tons.

It owns four steel mills, 11 pipe mills, and scrap processing centers and product finishing facilities in the United States and Canada. About 70 percent of its operations are in the U.S. and 30 percent are in Canada.


Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.