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Cleveland-Cliffs finalizes $775 million acquisition of Ferrous Processing and Trading Co.
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Cleveland-Cliffs finalizes $775 million acquisition of Ferrous Processing and Trading Co.

Cleveland-Cliffs finalizes $775 million acquisition of Ferrous Processing and Trading Company

Cleveland-Cliffs Burns Harbor is shown.

Cleveland-Cliffs has finalized a $775 million deal that allows it to enter the scrap business and make more recycled steel.

The Cleveland-based steelmaker, one of Northwest Indiana's largest industrial employers, completed its purchase of Ferrous Processing and Trading Co., a Detroit-based distributor of prime ferrous scrap. The company processes about 3 million tons of scrap per year at 22 scrap processing facilities around the country. 

It has about 15% of the domestic market with about 90% of revenues coming from the Midwest, mainly Michigan and Ohio. The company pulled in $100 million in EBITDA over the last 12 months.

“The way the scrap business historically worked has now changed for good," Cleveland-Cliffs Chairman, President and CEO Lourenco Goncalves said. "To drive this, we have already begun the dialogue with our steel customers with a focus on increasing our scrap offtake from them under a real closed-loop proposition.”

Ferrous Processing and Trading Co., which was just named Fastmarkets’ 2021 Scrap Company of the Year, is now a wholly owned subsidiary of Cleveland-Cliffs, the largest flat-rolled producer of steel in North America. Long a mine operator, it now employs more than 25,000 workers across the country.

Cleveland-Cliffs plans to use the new source of scrap to maximize production at its existing electric arc furnaces and basic oxygen furnaces.

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.

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