Nucor Starts 2007 with a Bang - Moves Forward with Capital Projects and Acquisitions in North America

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Researched by Industrial Info Resources (Sugar Land, Texas). Nucor Corporation (NYSE:NUE ) (Charlotte, North Carolina) is moving forward with several major capital projects and acquisitions to kick off 2007. Nucor has recently begun construction or is approaching construction in 2007 on three major mill projects in the U.S. totaling more than $500 million in total investment value (TIV).

On the acquisition front, Nucor continues a trend to acquire strategic downstream steel companies. In recent weeks, the company has announced plans to acquire steel fabricator Harris Steel Group (Toronto, Ontario) for $1.07 billion and in December 2006 acquired steel decking manufacturer Verco Manufacturing Company (Phoenix, Arizona).

Early this winter, construction began on a new $167 million hot dip galvanizing line addition at the company’s flat rolled steel sheet mill in Trinity, Alabama. A groundbreaking ceremony was held in October 2006. Nucor acquired the Trinity mill from Trico Steel Company, LLC, a subsidiary of the defunct LTV Steel Company, in 2002. Nucor is also constructing a $16.8 million direct reduced iron (DRI) processing facility in Trinity, which will enable it to receive imported DRI from a sister operation in Trinidad.

Demolition of existing buildings at the company’s steel mill site in Memphis, Tennessee is underway. Nucor acquired the former Birmingham steel mill, which was opened in 1997 and shutdown in 2000. Nucor will spend around $250 million to construct an 850,000-ton per year specialty bar quality (SBQ) steel mill at the site. Construction work will include retrofit and modification to existing mills and buildings and the addition of a 90-ton ultra-high power electric arc furnace, bloom caster, 150-ton per hour reheat furnace, as well as mills and a cooling bed, which will all be supplied by Italian equipment vendor, Danieli Corporation (Buttiro, Italy). Equipment is expected to be delivered to the site starting in June 2007. Nucor is acting as its own general contractor on all of its projects.

Danieli was also recently awarded equipment supply for Nucor’s second Castrip steel mill, which is being constructed at the Nucor-Yamoto steel mill in Armorel, Arkansas. Lockwood Greene, now CH2M Hill is preparing the installation engineering for the Castrip project.

To say the least, it is going to be a very busy 2007 for Nucor as these projects and acquisitions are executed.

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