U.S. Steel Pays $2.1 Billion For Lone Star
U.S Steel said the deal makes it North America’s largest producer of tubular products. Lone Star’s welded tubular business complements U.S. Steel’s predominantly seamless tubular product offerings. The transaction will boost U.S. Steel’s tubular manufacturing capability to approximately 2.8 million tons.
Shortly after this announcement, U.S. Steel in early April said it would form a $93 million joint venture with two South Korean companies to build a new domestic production facility for spiral welded pipe for the natural gas industry. The partners are Posco, South Korea’s leading steel producer and the world’s third largest, and tubular steel maker SeAH Steel Corp. The joint venture will be called United Spiral Pipe LLC. Spiral welded pipe represents a new market for U.S. Steel.
The new manufacturing facility is planned for Pittsburg, CA, and will be capable of producing 300,000 net tons of spiral welded tubular pipes annually. Production of the 24- to 64-inch diameter pipe is scheduled to begin in 2008. The new plant will be built adjacent to the facilities of USS-Posco Industries, a separate joint venture between U.S. Steel and Posco that makes coated steel products.
U.S. Steel and Posco each will hold a 35% ownership stake, while SeAH will own 30%.