Cia Siderúrgica Nacional SA's potential purchase of
the Brazilian slab-making unit of ThyssenKrupp AG
would be negative for shares, according to a note by Bank of
America Merrill Lynch analysts on Monday. Bloomberg News
reported on Friday that CSN, as Cia Siderúrgica is known, could
pay $3 billion to buy CSA, as Thyssen's unit is known.
According to the analysts, led by Thiago Lofiego, it is hard
to "find value" in the purchase; the deal could leave CSN, as
Brazil's No. 2 producer of flat steel products is known, more
indebted than now. Lofiego and his team added that Thyssen's CSA
is a loss-making mill that requires massive investments.
Currently, Bank of America Merrill Lynch has an
"underperform" recommendation with a 10.50 reais price target
for the next 12 months.