Bekaert Group

Bekaert expands in Central America and grows its Ropes platform


Source: Bekaert Group

  • Building new Dramix plant and taking majority stake in steel wire business in Costa Rica, with ArcelorMittal as partner
  • Growing its steel ropes platform by taking full ownership of Cimaf Cabos in Brazil
  • Building on existing partnerships in the region

Bekaert, a global market and technology leader in steel wire transformation and coatings, today announced its expansion plans in Central and Latin America, including the start-up of a Dramix plant in Costa Rica, the acquisition of the majority of the shares of the ArcelorMittal steel wire plant in Costa Rica, and raising its share from 45% to 100% in the Cimaf ropes plant in Brazil.

Bekaert’s expansions in Costa Rica will be implemented via the Bekaert Ideal Holding and hence includes a regional extension of the partnership between Bekaert and its Ecuadorian partners. The deal also builds on the partnership which Bekaert and ArcelorMittal currently have in Brazil.

The objective is to better serve customers from various sectors in the region with a broader steel wire product portfolio in the construction, agricultural, fencing and industrial markets. The decision to build a Dramix manufacturing plant in Costa Rica illustrates the strong belief in continued growth opportunities for innovative products in the construction sector in Latin and Central America.

As part of the transaction announced today, Bekaert will obtain full ownership of Cimaf Cabos in Saõ Paulo in Brazil, one of the manufacturing plants currently owned by Belgo Bekaert Arames. Cimaf Cabos is a leading steel rope producer in South America and is part of a business platform which Bekaert is gradually expanding on a global level and which serves mining, oil & gas, lifting equipment and infrastructure markets.

Newly consolidated entities

The activities in Costa Rica:

  • The steel wire activities in Costa Rica manufacture, sell and distribute wire products for construction, agricultural fencing, and industrial applications. The production and sales activities are located in Orotina (near San José), Costa Rica. The plant will be renamed BIA Alambres Costa Rica SA. BIA stands for Bekaert Ideal - ArcelorMittal.
  • A new Dramix plant will start up in Orotina, Costa Rica. The company will be named Bekaert Costa Rica SA. The plant will become operational in the second quarter of 2014. In a first phase, the plant will employ 60 employees, all of whom will be recruited in the local market. Bekaert adds the production of Dramix steel fibers to serve infrastructure and construction markets in the Americas. Dramix is a Bekaert designed and patented steel fiber for the reinforcement of concrete in industrial flooring and building projects, as well as in infrastructure applications such as tunnels and mine shafts.

Integration of the ropes activities in Brazil:
Cimaf Cabos will be renamed Bekaert Cimaf Cabos. This leading steel rope producer in South America will be integrated in Bekaert’s global ropes platform.

Impact of the transaction on Bekaert’s consolidated income statement:
The deal is subject to customary closing conditions and is expected to close in March 2014. Upon closing, the financial records of the steel wire activities in Costa Rica and the ropes activities in Brazil will be recognized in the consolidated statements of Bekaert. The financial statements of the Brazilian Cimaf Cabos entity were already accounted for in Bekaert’s financial statements under the equity method.

Under the assumption that the transaction would come into effect as of April 2014, the impact on Bekaert's 2014 consolidated sales is estimated at approximately € 50 million.

Deal scope and structure

a) Central America:
In Costa Rica, Bekaert will, through the Bekaert Ideal Holding (a 80/20 partnership between Bekaert and its Ecuadorian partners (represented by members of the Kohn family), acquire 73% of the steel wire activity of ArcelorMittal who will retain 27%. The new Dramix activity in Costa Rica will be set up with the same shareholders’ structure. As part of the deal, ArcelorMittal will participate 27% in the steel wire activity in Ecuador in which Bekaert Ideal Holding will retain the remaining 73%.

b) In Brazil, Bekaert will – via its 100% subsidiary Bekaert do Brasil – acquire 55% and thus become 100% owner of the Cimaf ropes plant which is now part of Belgo Bekaert Arames.

c) The transaction is a share swap with an overall cash-neutral impact. In Costa Rica, new investments are announced for a value of more than USD 20 million in 2014.

Bekaert in Latin America
Bekaert’s activities in Latin America go back to 1950. Today, they represent close to 40% of combined sales. They include the partnership with ArcelorMittal in Brazil, the subsidiaries under the Bekaert Ideal Holding in partnership with the Ecuadorian partners (represented by members of the Kohn family) in Ecuador, Venezuela and Colombia, and those within the partnership (partners represented by members of the families Matetic and Conrads) in Chile and Peru. At present, Bekaert employs more than 7700 people in the region. Today’s announcement builds on existing partnerships.

About Bekaert
Bekaert ( is a world market and technology leader in steel wire transformation and coatings. Bekaert (Euronext Brussels: BEKB) is a global company with headquarters in Belgium, employing 27 000 people worldwide. Serving customers in 120 countries, Bekaert pursues sustainable profitable growth in all its activities and generated combined sales of € 4.4 billion in 2012.

Customer comments

No comments were found for Bekaert expands in Central America and grows its Ropes platform. Be the first to comment!