Steel dust recycler Befesa plans major acquisition on US market

17.06.2021 − 

Befesa is seeking to become a global market leaders in steel dust recycling. The Spanish-German industrial waste management company announced yesterday that it is acquiring 100 per cent of American Zinc Recycling (AZR) assets for $450m (ca. €377m). The acquisition would boost Befesa's total steel dust recycling capacity by 40 per cent. Following the transaction, the recycler would be able to process 1.7 million tonnes per year of residues from electric arc furnace (EAF) mills at twelve plants located in Europe, Asia and the US. Subject to antitrust approval, the transaction is expected to close in the third quarter of 2021, said Befesa.

Headquartered in Pittsburgh, Pennsylvania, AZR is one of the leading providers of recycling services for environmentally hazardous waste to the U.S. steel industry, with a processing capacity of approximately 620,000 tons of EAF dust per year, according to Befesa. AZR operates four waelz kiln recycling facilities for EAF dust in South Carolina, Tennessee, Illinois and Pennsylvania, near major US mini-mills.

Befesa believes the transaction will significantly increase its own enterprise value. It offers short-term synergies and increases growth potential, according to its CEO Javier Molina. "“This transaction represents a great step forward in executing our strategy and in accelerating our growth globally. It brings together the two most established leaders in our respective markets to create a global EAF dust recycling leader under the Befesa name," Mr Molina said.

Befesa secures option to acquire AZR's zinc refining business

AZR also owns a zinc refinery in the state of North Carolina, where it processes Waelz oxide into special, high-quality zinc using a solvent extraction technology. Befesa says it will also acquire a 6.9 per cent stake in this business for $10m, with an option to acquire the remaining 93.1 percent for $135m if certain operational and financial milestones are achieved by the end of 2023. AZR's zinc refining business offers Befesa a strategic vertical integration opportunity to strengthen its own EAF dust recycling business in the US, the company explained.

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