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BlueScope Steel, Australia, to pay a special dividend of $292.5 Million to its shareholders

BlueScope Steel, an Australian steelmaker, announced on Wednesday that it would pay a special dividend to its shareholders of A$1 ($292.54m) funded by the surplus cash generated from recent asset sales.

The excess cash comes from the sale of a stake in the joint venture with India’s Tata Steel and an agreement to sell a 33-hectare?of land in West Dapto, Australia, for A$76million. It also comes from the ongoing residual projects within its properties group which are expected to deliver A$200million in working capital in fiscal 2025 and in fiscal 2026.

BlueScope manufactures steel products for construction and infrastructure. The company said it had chosen to return capital through a dividend, as a share buyback on the stock market was not feasible given the current business environment.

Australia's largest iron and steelmaker was last week

rejected

A consortium of Australian conglomerate SGH, and U.S. based Steel Dynamics made a $9 billion offer to takeover the company. The bidders were accused of trying to "buy it on the cheap".

BlueScope’s largest shareholder,?AustralianSuper backed its rejection, saying the offer undervalued the business. BlueScope is held by the pension fund, which owns 13.52%.

The company said on Wednesday that the free cash generation was expected to increase over the next 12-18 months. BlueScope expects a reduction of capital expenditure by at least A$500 millions in fiscal 2027 as compared to fiscal 2026.

In a statement, the company said that the special dividend would be payable on February 24. ($1 = 1.4972 Australian dollars) (Reporting by Rajasik Mukherjee; Editing by Alan Barona)

(source: Reuters)