SAO PAULO, June 29 (Reuters) - Ternium, a steelmaker in the Italian-Argentine Techint Group, is betting on its recently acquired Brazilian steel mill to create future growth opportunities, Chief Executive Daniel Novegil told investors on Thursday.
In a meeting in New York, Novegil said the acquisition of Companhia Siderúrgica do Atlantico SA would be transformative even as the group’s leverage rises, according to statements sent by Ternium to Reuters.
Novegil said the $1.3 billion acquisition would raise Ternium’s debt to up to 1.75 times its earnings before interest, taxes, depreciation and amortization, a gauge of profitability known as EBITDA. The steelmaker owed 0.5 EBITDA on the first quarter.
Ternium struck the deal with ThyssenKrupp AG in February to buy the money-losing Companhia Siderúrgica do Atlantico SA and is awaiting Brazil antitrust watchdog Cade’s approval.
Novegil also said he was working to reach an agreement with joint venture partner Nippon Steel & Sumitomo Metal Corp over the control of Brazilian steelmaker Usinas Siderúrgicas de Minas Gerais.
Novegil did not elaborate on ways to end the conflict that led the partners to sue each other.
Reporting by Aluisio Alerigi; Writing by Tatiana Bautzer; Editing by Richard Chang