The deal will see the Swedish company acquire 75 percent voting rights in the newly-formed entity. Finland's state investment company Solidium will become the largest shareholder of the new company.
The merger is based on SSAB’s public share swap offer, which the Rautaruukki board recommended to shareholders. The estimated total value of the offer is 1.1 billion euros.
“It’s long been thought in the steel industry that it would be logical for SSAB and Rautaruukki to come together,” chairman of the SSAB board Sverker Martin-Löf said in a statement.
The combined metals and engineering company would have operations in the Nordics and the United States, and would be active globally. The new company will have its headquarters in Stockholm, Sweden.
The share swap offer will see each Rautaruukki share traded for 0.4572 A shares in the new SSAB entity and for 1.2131 B shares. A shares entitle owners to a full vote, while B shares will command one-tenth of a vote in shareholder meetings.
If the offer is accepted in its entirety, SSAB will own 58 percent of the combined business and will have 75 percent voting rights.
State investor Solidium and Industrivärden, the largest SSAB shareholder, have both announced their support for the merger.
Solidium will become the largest shareholder of the new company and the second largest owner in terms of voting rights.
