Outokumpu sells half of its European storage sites

Outokumpu (OMX:OUT1V) is divesting parts of its stocking operations to multi-metal distributor Amari Metals. The 10 stock operations in nine countries constitute half of Outokumpu’s European warehouses. They employ around 100 people, who will be moving to Amari. The transaction should close in Q3 and is expected to net 15-20 million Euros in cash, depending on the stock value at closing. Outokumpu will take a ”marginal impairment” in Q2 accounts for the deal. Outokumpu is focusing on the operations in the remaining centres and closer cooperation with independent distributors.

The Inoxum acquisition competition authorities review is still ongoing. Outokumpu has a long ride ahead even if the deal is mostly agreed to, as it will then be unable to do the necessary savings from German operations for a number of years, facilitating a need for heavy savings and divestments elsewhere to try to ride out the interim. Recent heavy steel price decline has has weighed heavily on the share price and it is languishing far below recent emission price.