The country’s two leading steel manufacturers, Industrias Nacionales (INCA) and the Complejo Metalurgico Dominicano (Metaldom) have announced the completion of a merger that has resulted in Gerdau Metaldom.
As reported, INCA has the capacity to produce 850,000 metric tons and Metaldom has a capacity for 400,000 metric tons. Combined production of both in 2013 was 570,000 metric tons.
INCA was a subsidiary of Brazil’s Gerdau. The company produces long and flat steel for the civil construction, industrial and agricultural sectors, and also has operations in scrap processing and PVC pipes. Metaldom mainly manufactures metal from scrap and was fully owned by the Vicini Group. ?
The owners of the new company are now: 45% Gerdau S.A., 45% Vicini Group and 10% company headed by INCA general manager Carlos Valiente. The central offices of the company will be located at the La Isabela Industrial Zone (ZILI) in Santo Domingo province.
Credit risk analysts Feller Rate says that the merger will have a positive impact on the profile of the company that will be able to position itself as a leader in the Dominican Republic with a strong presence in the Caribbean and Central America. Likewise, there are expectations for significant synergies, economies of scale and a more efficient cost structure taking advantage of installed capacity of both plants.
Gerdau Metaldom combines Inca’s and Metaldom’s three plants, and a distribution center in Costa Rica. Integration is expected to last one to two years.
http://www.feller-rate.com.do/grd/cp/corporaciones/cpinca1409.pdf