SYDNEY, January 7, 2026 – BlueScope Steel (BSL.AX) has officially rejected a $A13.2 billion ($8.92 billion) takeover proposal from SGH (SGH.AX) and U.S.-based Steel Dynamics (STLD.O), saying the offer significantly undervalues the Australian steelmaker and accusing the bidders of attempting to acquire the company “on the cheap.”
The announcement comes shortly after BlueScope shares closed 1.12% higher at A$29.87, slightly below the A$30 per share offer that was first made public on Monday. This marks the fourth attempt by Steel Dynamics to acquire BlueScope since late 2024.
“Let me be clear – this proposal was an attempt to take BlueScope from its shareholders on the cheap,” said BlueScope Chair Jane McAloon.
“This is the fourth time we’ve said no, and the answer remains the same – BlueScope is worth considerably more than what was on the table.”
Why BlueScope Rejected the Bid
According to the company, the proposed takeover would be adjusted for future dividend payments and could take an extended period to finalize, effectively reducing the net value of the A$30 per share offer. BlueScope also raised concerns about the funding structure of the bid, noting that while the company had “virtually no net debt” last year, the bidders intended to leverage BlueScope’s balance sheet to fund the acquisition.
Under the deal terms:
- SGH, controlled by Australian billionaire Kerry Stokes, would acquire BlueScope.
- Steel Dynamics would then acquire BlueScope’s North American operations.
Despite BlueScope shares trading close to the offer price, some investors expressed that the bid would likely need to be higher to secure broader shareholder approval.
“It’s good that there’s some interest in BlueScope,” said Jamie Hannah, deputy head of investments at VanEck, a BlueScope and SGH investor.
“Looking at the valuations, it’s not enough. If they want to get any of the shareholders over the line, they’re going to have to increase the offer.”
Shareholder Influence and Potential Next Steps
AustralianSuper, BlueScope’s largest shareholder with a 12.5% stake, has not commented publicly on the bid. In Australia, major pension funds like AustralianSuper often play a decisive role in corporate transactions, and their backing could determine whether a revised offer succeeds.
Historically, AustralianSuper has acted as a gatekeeper for large acquisitions, most notably blocking Brookfield’s $10.6 billion bid for Origin Energy in 2023, citing undervaluation concerns.
Analysts suggest that the current takeover attempt will face intense scrutiny from shareholders and regulatory authorities before any potential agreement is reached.
Market Reaction
The Australian steel industry has been closely monitoring this potential acquisition, with analysts noting that BlueScope’s operations in Port Kembla and North America make it a highly strategic asset. While the stock price initially reflected optimism about the deal, the board’s firm rejection may lead the bidders to either increase the offer or reconsider the proposal.
“The market is signaling cautious optimism, but investors want to see a fair valuation that reflects BlueScope’s long-term growth potential,” said a market analyst in Sydney.
Outlook for the Australian Steel Sector
BlueScope Steel’s decision highlights the challenges of cross-border mergers and acquisitions, particularly in capital-intensive industries like steel. The rejection also underscores the importance of shareholder approval and corporate governance in determining the outcome of high-value bids.
As global steel markets remain volatile due to supply chain disruptions and fluctuating commodity prices, investors will be watching closely whether SGH and Steel Dynamics adjust their bid or abandon the acquisition attempt.
Conclusion
BlueScope Steel’s firm rejection of the $8.92 billion takeover bid from SGH and Steel Dynamics emphasizes the company’s confidence in its valuation and commitment to protect shareholder value. With key institutional investors like AustralianSuper potentially playing a decisive role, the future of the bid remains uncertain. Analysts expect any revised proposal to reflect a premium above the current market price to gain shareholder support and move forward.
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