Ryan Stokes has closed the book on one of the biggest takeover pursuits the ASX has seen this year.
“We’re disappointed we didn’t secure that [deal], and that’s fine,” the Seven Group Holdings’ (SGH) chief executive told Peter Switzer on this week’s Switzer Show. “I think from our perspective, that deal’s pretty much closed.
“So we’ll look at other opportunities for SGH.”
The chase
BlueScope had been courting acquisition approaches since late 2024 when a Steel Dynamics-led consortium that did not include SGH offered $27.50 and then $29.00 a share. In early 2025 Steel Dynamics alone proposed a two-part structure implying about $33.00. The board said no each time.
SGH joined the field in December 2025, when a consortium of SGH and Steel Dynamics proposed $30.00 a share in cash, a premium of about 27% to the prior close. The structure had SGH acquiring all of BlueScope, keeping the Australian and international operations, and on-selling the North American business, including the North Star mill in Ohio, to Steel Dynamics. BlueScope’s chair rejected it in January with the words “this is the fourth time we’ve said no.”
In February the consortium went to $32.35 a share, an equity value of about $15 billion, and called it best and final. This time the board did not issue a flat rejection: it said the proposal “does not adequately address our valuation concerns”, declined to recommend it, and left the door open to a deal at what it considers fair value.
The proposal paused there.
Why Stokes walked
Stokes told Peter Switzer the decision came down to the same discipline SGH applies everywhere:
“For us there are aspects we like about that opportunity, but it has to stack up and ensure that we can generate a return for our shareholders. And if that doesn’t work out, well, there’ll be other opportunities.”
BlueScope’s full-year result, filed on 17 August, shows the valuation each side was arguing over. Underlying EBIT came in at $1.27 billion. The North American wing of the portfolio, North Star, lifted underlying EBIT 201% to $805.3 million on stronger US steel spreads. Australian Steel Products went the other way, down 28% to $188.2 million as low Asian export spreads squeezed margins.
Under the consortium’s structure, the booming North American business was the piece SGH would have sold on. The Australian business was the piece it would have kept.
Stokes read it the same way. “Right now they’re enjoying a great period of the cycle with the North American business and the steel spreads. But looking at Australia, there are some challenges,” he said. The performance of the Australian business “does have a number of questions around that.”
Where the money goes now
SGH announced an on-market buyback of up to $500 million in June, and it commenced following the group’s full-year result on 11 August. Stokes connected the two decisions directly.
“Where there isn’t the opportunity and we have surplus capital, if our shares are trading at discount, it makes sense to acquire them. And that’s the logic behind the buyback.”
He would still rather find the next deal. “Ideally I’d love to find another opportunity for growth. But again, patience has served us very well. And we know that in time, opportunities will present themselves.”
This article does not take into account the investment objectives, financial situation or particular needs of any individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances. Before acting on anything we discuss, we strongly recommend you seek the appropriate professional advice.
