On November 18, 2007, Gerdau S.A. agreed to acquire the steel business of Quanex Corporation in a transaction valued at $1.67 billion. Simpson Thacher represented Gerdau S.A. in the transaction.
Prior to the acquisition, Quanex will spin-off its building products business to its stockholders as a stand-alone company to be called Quanex Building Products. Gerdau will then acquire all of the outstanding shares of common stock of Quanex at a per-share price of $39.20.
Quanex's Macsteel business, an engineered steel bar producer, is headquartered in Jackson, Michigan, with steel mini-mills in Monroe, Michigan and Fort Smith, Arkansas. Gerdau S.A. of Brazil is the largest long steel producer in the Americas. Simpson Thacher represented Gerdau Ameristeel, Gerdau S.A.'s US public subsidiary, in its $4.5 billion acquisition of Chaparral Steel earlier this year.
The closing of the transaction is subject to the approval of Quanex’s stockholders and other customary closing conditions, including regulatory approvals. The merger is expected to close in the first quarter of 2008.
The Simpson Thacher attorneys working on the deal are: Alan Klein, Joel Karansky, Nathan Chaney, Greg Finkell and International Associate Andrew Wingfield (M&A); John Creed, Noah Beck and Peter Rosen (Tax); Brian Robbins, Andrew O’Brien and Beth Understahl (Executive Compensation); Joe Tringali (Antitrust); Ivan Rothman (Intellectual Property); Julie Levy and Andrew Janis (Labor); Krista McManus (Real Estate); Michael Isby and Tim Mulvihill (Environmental).