Thursday, February 08, 2018

CADE approves merger of Arcelor and Votorantim in long

The Court of the Administrative Council for economic Defense (Cade) did not follow the recommendation of the opinion of the Superintendent-General and approved by signature of agreement, the merger of long steel business of ArcelorMittal and Votorantim. During the trial this Wednesday (07), the rapporteur, Councillor Vijay Sarathy Vilanova, defended the agreement on Merger Control (ACC) proposed by the companies-providing for the sale of two assets packages for two different companies, They shall correspond to one-third of which was bought by ArcelorMittal – reduces significantly the competitive risks ". Sales involve today units of ArcelorMittal in Cariacica (ES), Itaúna (MG) and two other units in undisclosed location. "If a market with three agents showed such stability, is not to be expected that a reduction to two agents requires an aggressive practice of price increase" evaluated Kalyan. "The ACC includes all competitive concerns proposed along the instruction of this operation," she adds. "The agreement has been prepared considering three main obligations in order to preserve the conditions of competition on the relevant markets impacted directly or indirectly by the operation." João Paulo de Resende Advisor came to start a divergence in the case, voting for censure because the merger would divide the long steel market between just two companies, resulting from such merger and Gerdau. He was accompanied by Cristiane Adviser Alkmin, for who, the Division that will fortify itself after the operation because the sale of assets proposed would have very low probability to create a strong competitor as was Votorantim Siderurgia. However, the rapporteur's vote followed the counselors Mauricio Oscar Maia, Paulo Burnier Flag da Silveira and the President of Cade, Alexandre Barreto de Souza, who did most for the approval. In a statement, the National Institute of Preparation of Nonferrous scrap metal and iron and steel (Inesfa) pointed out that actively participated in the discussions related to the purchase of the long steel division of Votorantim by ArcelorMittal and that "includes complexity of the case and respects the decision, regretting the adoption. " "The Brazilian steel market has an agenda. For 30 years were almost 30 steel groups in Brazil, and from the decision today, are two large groups controlling so widely dominant long steel market ", criticized the Institute. The President of ArcelorMittal to South America, Jefferson De Paula, told reporters that the restrictions imposed by Cade to approve the purchase of Votorantim steel company were tough, but the operation still generates a lot of value to the group. "We are very pleased with the result, the acquisition of Votorantim is very important to ArcelorMittal and will allow many synergies."
DCI - 08/02/2018 News Item translated automatically
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