Citi sees slim chances for PE takeover of Australia's Bluescope Steel

BSL

24/11/2020 24:47

** Citi Research considers reports around a takeover bid for
BlueScope Steel  BSL.AX  from private-equity firms are unlikely
to result in a deal
    ** Private equity players were looking into an potential
offer that could price the steelmaker at A$25 per share and
might involve splitting the company by region, the Australian
Financial Review reported https://www.afr.com/street-talk/dirty-work-pe-puts-blowtorch-on-bluescope-steel-20201122-p56gsa
    ** Shares rise as much as 2% to A$17.27
    ** "We think managing currency exposures and the risk of
buying at/near a cyclical high in steel pricing/margins makes
this a less likely event" - Citi
    ** With BSL shares rising over 60% in the last six months to
last close, Citi says it is hard to argue there is now a case
for undervaluation
    ** Citi adds BSL is a well-run steel company with "little
fat to trim"; significantly restructured operations in past four
years have made it more resilient to market downturns

 (Reporting by Arpit Nayak in Bengaluru)
 ((Arpit.Nayak@thomsonreuters.com; +91  80 6182 3472;))