SSAB to Transfer Rock Bolt Business to Jennmar in Strategic Business Realignment
On January 7, 2025, SSAB, a leading steel manufacturer, announced its intention to divest its expandable rock bolt business unit based in Virsbo to Jennmar, a U.S.-based company specializing in mining and infrastructure products. This strategic move is part of SSAB’s focus on refining its core business operations, aligning resources towards high-strength steel and value-added products.
The Divestment Details
The agreement between SSAB and Jennmar will see the U.S. company take over SSAB’s rock bolt manufacturing unit in Virsbo, Sweden. The transaction affects a total of 66 employees, all of whom have received offers to continue their employment with Jennmar. These employees will now become part of Jennmar’s global workforce, which currently employs approximately 4,000 people worldwide.
The divestment is a significant development for both companies. For SSAB, it marks the departure from a non-core business that no longer aligns with its strategic focus on high-strength steel products. Jennmar, on the other hand, is well-equipped to expand the operations in Virsbo, thanks to its established portfolio of mining and infrastructure products.
Why the Divestment Makes Sense for SSAB
SSAB’s decision to divest the Virsbo rock bolt unit is rooted in the company’s long-term strategy to concentrate on its core strength—high-strength steel and value-added products. As Per Elfgren, Head of SSAB Special Steels, explained, the current market for rock bolts with high-strength steel is limited, and therefore, it makes more sense for the company to focus on products that align with its strategic vision.
"SSAB’s Special Steels division has the strategy to focus on value-added products using our high-strength steel," said Elfgren, underscoring the company’s commitment to its primary business objectives.
The expandable rock bolts produced at the Virsbo facility are made from high-quality steel sourced from the Nordic region, and the bolts are sold to global mining and tunneling markets, including Europe, North and South America. However, as demand for rock bolts featuring high-strength steel has waned, SSAB determined that divesting this non-core business would allow them to concentrate resources on areas with greater growth potential.
Jennmar's Expertise and Strategic Fit
Jennmar, a privately owned company with over 100 years of experience in the mining and infrastructure sectors, is well-positioned to take over the Virsbo operation. Jennmar already manufactures its own expandable rock bolts in the U.S. and has a strong foothold in the mining industry, making the Virsbo unit a natural addition to its portfolio.
Sara Valentin Eklöw, responsible for operations in Virsbo and Sales Director for SSAB’s expandable rock bolts, expressed her satisfaction with Jennmar’s involvement. “I am very pleased that such an established company is interested in taking over the rock bolt production and continuing to develop it. They have extensive experience in the mining industry and also manufacture their own expandable bolts in the U.S.," said Eklöw.
Jennmar’s ability to integrate the Virsbo operations into its existing business model is expected to result in greater growth for the rock bolt unit, benefiting both the employees and the customers who rely on these products for mining and tunneling projects worldwide.
The Transaction and Future Outlook
The divestment is expected to be finalized in the first quarter of 2025. Once completed, Jennmar will assume full control of the rock bolt unit, while SSAB will continue to focus on its core business of producing high-strength steel products for a range of industries.
The transaction highlights the evolving nature of the global steel and manufacturing industries, where companies like SSAB are increasingly narrowing their focus to align with emerging market trends and technological advancements. Meanwhile, Jennmar’s acquisition of the Virsbo unit demonstrates its ongoing commitment to expanding its operations and presence in the mining and infrastructure sectors.
As both companies move forward, SSAB’s strategic realignment will allow it to invest more in its high-strength steel operations, while Jennmar stands to benefit from the additional manufacturing capabilities and expertise brought by the Virsbo unit. The transition promises to be a mutually beneficial development, with the potential for growth and innovation in both the steel and mining sectors.
