THE board of BlueScope Steel Limited announced last week (7 January) that it had unanimously rejected an “unsolicited, non-binding, indicative and conditional takeover proposal”, and listed the unrealised value of its land bank, including at Western Port, as one of the reasons for rejecting the offer.
The offer was presented by a consortium comprising ASX listed SGH Limited, and BlueScope rival United States steelmaker Steel Dynamics, at $30 per share, valuing BlueScope at $13.2b.
SGH Limited was founded by Kerry Stokes and is headed by son Ryan Stokes. The company is said to be a “diversified operating company, with market leading businesses across industrial services, energy and media”. The company holds a 40.2% stake in Seven West Media and a host of industrial businesses, including Boral, Coates and SGH Energy.
The other participant in the consortium, Steel Dynamics Inc, is a NASDAQ listed US steel producer with a current market capitalisation of US$24.5b.
Under the consortium’s plan, United States assets would be acquired by Steel Dynamics and the “rest of the world” assets retained by SGH.
The board unanimously rejected the takeover proposal on the basis that it “very significantly undervalued BlueScope”.
BlueScope chair, Jane McAloon, said, “Let me be clear – this proposal was an attempt to take BlueScope from its shareholders on the cheap. It drastically undervalued our world-class assets, our growth momentum, and our future – and the board will not let that happen”.
Further to the argument based on operating metrics, the announcement stated the takeover proposal failed to adequately reflect the value expected to be delivered from various initiatives, including the monetisation of BlueScope’s 1,200 hectare “no-operational” land portfolio.
BlueScope Western Port currently holds a “non-operational” land bank in Western Port of 450 hectares (over 1,100 acres) to which the company has implied a value of over $1b. BlueScope has listed potential uses for this excess land in the fields of energy (data centres, renewables, battery energy storage systems), logistics (warehousing, rail, hardstand, port), downstream businesses /manufacturing, and R&D/social infrastructure (educational precincts, industrial innovation, parks).
The entirety of its “non-operational” land bank across four sites has been given an implied value by BlueScope of $2.8b.
SGH, that would hold all non-US assets under the proposed takeover offer, argues that BlueScope’s assets would benefit “as stand-alone businesses under new ownership”. Although no specific information has been provided about plans to retain all the Australian operations, SGH’s announcement stated its proposal would deliver “compelling value [for]… stakeholders including team members and local communities”.
Ryan Stokes, managing director and chief executive of SGH said: “We believe BlueScope’s Australian business is a strong strategic fit for SGH and we have a proven track record of driving performance improvement in domestic industrial businesses”.
“We intend to leverage our disciplined operating model and capital allocation approach to deliver better outcomes for stakeholders.”
First published in the Western Port News – 14 January 2026