Canadian steelmaker Dofasco said on Monday it agreed to terminate its agreement with ThyssenKrupp after the German industrial group waived its right to raise a C$68 per share bid for Dofasco to match a higher offer.
Arcelor agrees to buy Dofasco
Arcelor said on Tuesday it had agreed to acquire Dofasco for C$71 per share in a cash deal valuing the Canadian steel maker at C$5.6 billion.
Arcelor made the announcement in a joint statement with Dofasco after German rival ThyssenKrupp withdrew from the bidding war.
Questions linger after Dofasco bidding war
Dofasco embraced a $5.5 billion takeover bid by Arcelor SA yesterday but questions remain about relations between the two companies after months spent fighting off the European steel giant’s advances.
After months of siding with Germany’s ThyssenKrupp, Dofasco CEO Don Pether put a positive spin on the Arcelor takeover.
“Certainly Dofasco’s management team is fully committed and excited about the opportunity this presents and committed to the success and sustainability of the organization going forward,” Pether told reporters on a conference call.
But Dofasco’s decision to draw ThyssenKrupp into the bidding fray as its white knight may result in some strained relationships with Arcelor, said Chuck Bradford, an analyst with New York’s Soleil Securities.