20 Oct 2008

Steel company sale off

6:15 am on 20 October 2008

Another takeover deal is a casualty of the economic downturn.

Australian steelmaker OneSteel has pulled out of a $175 million offer for Steel & Tube, blaming market volatility and the company's exposure to the New Zealand economy.

The offer of $4 per share would have been a premium on Steel & Tube's closing shareprice of $3.60 on Friday.

Onesteel already owns more 50% of the company.

OneSteel managing director Geoff Plummer says the situation has changed dramatically since OneSteel announced its intention to make an offer for Steel & Tube last month.

Given the risk associated with the proposed offer has increased significantly, he says OneSteel decided not to proceed.