Brazilian steelmaker CSN is accelerating its asset divestment plan under new CEO Fabio Schvartsman, who took over from Benjamin Steinbruch earlier this month. The company aims to reduce its substantial debt, which stood at $8.2 billion (R$42.1 billion) with a leverage ratio of 3.49x in the second quarter of this year. Schvartsman's arrival has been positively received by the market, with analysts from BTG Pactual highlighting his experience and alignment with market expectations for deleveraging and asset sales, contributing to a rally in CSN's bonds.
The sale of CSN Cimentos is reportedly close to finalization, with China's Huaxin Cement Co. emerging as the frontrunner with a $2.1 billion (R$11 billion) offer. While Votorantim SA and Italy's Cementir were also in the bidding, Huaxin's offer seems to have progressed furthest. This transaction is crucial for CSN, especially given a $1.2 billion bridge loan with a clause that increases interest rates if the cement unit's sale is delayed. The proceeds from this sale are expected to cover a significant portion of this loan.
In addition to the cement unit, CSN is also advancing negotiations to sell a 20-30% stake in its infrastructure holding company, CSN Infraestrutura, which includes ports, railways, and logistics operations. While the initial deadline for these sales, set for the third quarter, might be missed, the company intends to complete these divestments by the end of the year. Furthermore, Schvartsman is reportedly considering the sale of CSN's steel assets in Germany, which could generate an additional $290 million (R$1.5 billion). These strategic moves are aimed at restoring investor confidence and restructuring the company's financial profile.
