Doha, October 09 (QNA) - Industries Qatar (IQ) announces the completion of acquisition of 100% shares of Al Qataria for Production of Reinforcing Steel W.L.L "Al-Qataria" by its fully owned subsidiary Qatar Steel Q.P.S.C "Qatar Steel" for a total consideration of QR 346 million (on a cash free, debt free basis) for which funding will be sourced though internal group funding.

The group believes that the acquisition of Al Qataria by Qatar Steel Q.P.S.C will bring several strategic and tactical benefits to both Qatar Steel and to the group.

The acquisition will allow Qatar Steel and the group to consolidate its market position as the leading supplier of steel bars, as Qatar Steel is acquiring a direct competitor with a sizeable production capacity.

The acquisition will bring additional cost synergies in the form of value chain optimization via establishing mutual billet procurement from acquiring Al Qataria, instead of importing raw materials.

Further synergies could be achieved through operational excellence keeping conversion costs low and integration with Qatar Steels main production facilities.

The acquisition is planned to be further followed by execution of the diversification into new products (Wire Rod Coil) that is not currently part of Qatar Steels existing product portfolio in Qatar.

The group believes that the acquisition of Al Qataria will strengthen Qatar Steels leadership position on the domestic steel market and will contribute to additional shareholder value creation.

Furthermore, the group believes that this acquisition will unlock new export destinations for products like wire rod and rebar in coil to countries within the GCC region and the international markets.

The acquisition of Al Qataria will help support the groups medium- and long-term growth strategy. (QNA)