Bekaert Announces Sale of Steel Wire Solutions Businesses in Costa Rica, Ecuador, and Venezuela
In a strategic move to further transform its global business portfolio, Bekaert, a world leader in the production of steel wire products, has announced the sale of its Steel Wire Solutions businesses in Costa Rica, Ecuador, and Venezuela to Grupo AG. This transaction, valued at US$ 73 million, marks the latest step in Bekaert’s strategy to streamline operations and increase its focus on higher-margin markets that offer greater growth opportunities and superior returns on capital.
Transaction Overview
The sale involves Bekaert’s production and distribution facilities in the three countries, which manufacture a wide range of steel wire products. These products are primarily used in construction, agricultural fencing, mining, and industrial applications. The specific entities included in the sale are:
• BIA Alambres Costa Rica S.A. (Costa Rica)
• Ideal Alambrec S.A. (Ecuador)
• Vicson S.A. (Venezuela)
In total, these businesses employ hundreds of people and serve a broad customer base across Latin America. The deal includes the shares of these companies, as well as their subsidiaries in the respective countries. As part of the transaction, Grupo AG will assume control of the operations and continue to support the local markets.
The sale is expected to be finalized by the third quarter of 2025, contingent upon the usual regulatory approvals and the satisfaction of customary closing conditions.
Strategic Rationale Behind the Sale
Bekaert has been progressively reshaping its business model in recent years, focusing on more specialized markets that offer higher profit margins and better growth potential. This is part of the company's long-term strategy to transition away from the more commoditized and volatile steel wire markets where profit margins are lower and competition is fiercer.
The sale of the Steel Wire Solutions operations in Costa Rica, Ecuador, and Venezuela follows the company’s earlier decision to divest similar businesses in Chile and Peru in 2023. As François Desné, the Divisional CEO of Bekaert’s Steel Wire Solutions business unit, explained:
“The proposed transaction unlocks the value of these businesses for Bekaert. It marks another significant milestone in our portfolio transformation, further strengthening our Steel Wire Solutions business with a more competitive and resilient market position. While we have achieved numerous successes together with our longstanding partners in these countries, the characteristics of the markets in Costa Rica, Ecuador, and Venezuela no longer align with our strategy.”
He continued:
“We are confident that this transition will ensure continuity for the local teams and customers under the new ownership when the sale closes, providing long-term sustainability for these businesses and their stakeholders.”
Financial Impact of the Sale
For Bekaert, the transaction is expected to have a positive financial impact. In 2024, the Steel Wire Solutions businesses in Costa Rica, Ecuador, and Venezuela generated approximately US$ 137 million in consolidated revenue. With the sale expected to result in net proceeds of approximately US$ 37 million, Bekaert anticipates that these funds will strengthen its balance sheet and support its investment plans for future growth, particularly in high-margin and emerging markets.
The proceeds will also enhance Bekaert’s financial flexibility, enabling the company to reinvest in its key business units and drive shareholder returns. As Desné further emphasized:
“The proceeds from this sale will be reinvested to enhance the resilience of our business and to support our growth strategy moving forward. This divestment is aligned with our focus on markets that offer higher profitability and strategic value.”
Transition and Impact on Employees and Customers
Bekaert has made it clear that while the transaction will mark the exit of the company from the steel wire businesses in these countries, it is committed to ensuring continuity for the local employees and customers. Grupo AG, the buyer of the businesses, will take over all operations, and Bekaert has expressed confidence that the new ownership will be able to continue delivering quality products and services to its longstanding clients.
The local teams in Costa Rica, Ecuador, and Venezuela will be integrated into the new ownership structure, ensuring minimal disruption to their work. Additionally, the transition will be carefully managed to maintain the quality and reliability of the steel wire solutions provided to customers in the region.
Bekaert’s ongoing commitment to its employees and customers is reflected in the careful approach the company is taking to this sale, as Desné reiterated:
“We are committed to ensuring a smooth and seamless transition for our employees and customers. Our partners and customers in these regions have been integral to our success, and we are confident that this new ownership will continue to provide them with the same high level of service and quality they have come to expect.”
Bekaert’s Long-Term Strategy and Market Focus
The divestment of these businesses is a key part of Bekaert’s long-term strategy to focus on high-growth sectors and markets that offer greater profitability. The company has been prioritizing investments in advanced technologies and innovative solutions in areas such as automotive, energy, and construction—sectors where it sees the greatest potential for future growth.
As part of this shift, Bekaert is also focused on expanding its presence in emerging markets where demand for high-quality steel wire products is growing. These markets, along with Bekaert's investments in cutting-edge technology, are expected to drive the company’s future success and enhance its position as a global leader in the steel wire industry.
Desné concluded:
“This divestment is not just about exiting markets; it’s about focusing on where we can add the most value and achieve the highest returns. We are confident that the changes we are making to our portfolio will strengthen Bekaert’s position in the long run, as we continue to innovate and adapt to the evolving demands of the global marketplace.”
Key Takeaways:
• Bekaert has announced the sale of its Steel Wire Solutions businesses in Costa Rica, Ecuador, and Venezuela to Grupo AG for US$ 73 million.
• The transaction includes Bekaert's production and distribution facilities in these countries, which manufacture steel wire products for industries such as construction, agriculture, and mining.
• In 2024, these operations generated US$ 137 million in revenue, and the sale is expected to provide net proceeds of approximately US$ 37 million.
• The sale is part of Bekaert’s strategy to focus on higher-margin markets and emerging growth sectors, while reducing exposure to commoditized markets.
• The sale is expected to close in the third quarter of 2025, pending regulatory approvals and customary closing conditions.
• The divestment follows Bekaert's previous sale of its Steel Wire Solutions businesses in Chile and Peru in 2023, marking continued efforts to reshape its global portfolio.
• Bekaert is committed to ensuring continuity for employees and customers under the new ownership by Grupo AG.
• The proceeds from the sale will strengthen Bekaert's balance sheet and support its growth strategy and shareholder returns in the future.
This transaction further refines Bekaert’s portfolio, ensuring the company is well-positioned to capitalize on opportunities in high-growth, high-margin markets as it continues to evolve in the global steel industry.
