Ternium Seeks to Streamline Its Corporate Structure by Offering to Acquire the Minority Participation in Ternium Mexico that it Does Not Own Directly

Rhea-AI Summary

Ternium S.A. (NYSE:TX) announced a $1.0 billion bid to acquire a 28.73% stake in Ternium Mexico S.A. de C.V. from its subsidiary Ternium Argentina S.A. (BYMA: TXAR). This acquisition will streamline the corporate structure, enhancing management efficiency and stakeholder analysis. Currently, Ternium owns 71.27% of Ternium Mexico and 62.49% of Ternium Argentina. The transaction requires 95% approval from Ternium Argentina's shareholders and includes a $900 million dividend. If approved, the deal is expected to finalize in Q1 2022.

Positive

• Acquisition aims to streamline corporate structure, leading to better management and performance analysis.
• Potential for enhanced operational efficiency and shareholder value.

Negative

• Acquisition contingent on 95% shareholder approval, which introduces uncertainty.
• Approval requires simultaneous dividend distribution of $900 million, potentially stressing financials.

LUXEMBOURG / ACCESSWIRE / December 21, 2021 / Ternium S.A. (NYSE:TX) today announced a $1.0 billion offer to acquire from its publicly listed subsidiary Ternium Argentina S.A. (BYMA: TXAR) a 28.73% participation in Ternium Mexico S.A. de C.V. that Ternium does not own directly.

Ternium currently owns directly 71.27% and 62.49% of Ternium Mexico and Ternium Argentina, respectively, and fully consolidates the assets, liabilities and results of operations of both companies. Ternium Argentina is listed in the Argentine Stock Exchange (BYMA) and its main non-Ternium shareholder is Argentina's national social security administration, with a 26.43% participation. No other shareholder has a participation in excess of 5% of Ternium Argentina's shares.

The proposed transaction would be subject to, among other conditions, its approval by Ternium Argentina's shareholders meeting with the affirmative vote of 95% of the shareholders present (excluding Ternium) and the simultaneous approval by Ternium Argentina of a dividend of $900 million.

"This transaction is primarily aimed at streamlining our corporate structure," said Ternium CEO Máximo Vedoya. "A simplified corporate structure contributes to a more straightforward management of our operations and an easier analysis by our stakeholders of our performance and results. We will continue looking for opportunities to add value to our shareholders."

If approved by Ternium Argentina's shareholders meeting, the transaction is expected to close in the first quarter of 2022.

About Ternium

Ternium is Latin America's leading flat steel producer, with operating facilities in Mexico, Brazil, Argentina, Colombia, the southern United States and Central America. The company offers a broad range of high value-added steel products for customers active in the automotive, home appliances, HVAC, construction, capital goods, container, food and energy industries through its manufacturing facilities, service center and distribution networks, and advanced customer integration systems.

Forward Looking Statements

Some of the statements contained in this press release are "forward-looking statements". Forward-looking statements are based on management's current views and assumptions and involve known and unknown risks that could cause actual results, performance or events to differ materially from those expressed or implied by those statements. These risks include but are not limited to risks arising from uncertainties as to gross domestic product, related market demand, global production capacity, tariffs, cyclicality in the industries that purchase steel products and other factors beyond Ternium's control.

Sebastián Martí
Ternium - Investor Relations
+1 (866) 890 0443
+54 (11) 4018 8389
www.ternium.com

SOURCE: Ternium S.A.

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https://www.accesswire.com/678895/Ternium-Seeks-to-Streamline-Its-Corporate-Structure-by-Offering-to-Acquire-the-Minority-Participation-in-Ternium-Mexico-that-it-Does-Not-Own-Directly

FAQ

What is Ternium's acquisition offer related to Ternium Mexico (TX)?

Ternium has offered $1.0 billion to acquire a 28.73% stake in Ternium Mexico from Ternium Argentina.

What approval is needed for Ternium's acquisition to proceed?

The acquisition requires 95% approval from Ternium Argentina's shareholders.

When is the expected closing date for Ternium's acquisition?

The transaction is expected to close in the first quarter of 2022.

What is the primary goal of Ternium's acquisition?

The primary goal is to simplify Ternium's corporate structure for better management and performance evaluation.