Australia's largest steelmaker, BlueScope Steel, has delivered a swift and forceful rejection of a $13 billion takeover bid from Western Australian billionaire Kerry Stokes, labelling the proposal as "cheap" and "opportunistic". The board's dismissal, issued just three days after BlueScope made the bid public, marks the fourth time the company has rebuffed advances from its US suitor, Steel Dynamics, in the past two years.
A Proposal to 'Break Up' a National Icon
The takeover bid, revealed to the Australian Securities Exchange on Monday, January 5, 2026, was formally made on December 12, 2025. The consortium, comprising Mr Stokes' diversified investment vehicle SGH Limited and the American steel giant Steel Dynamics, offered $30 per share, representing a 27% premium on BlueScope's share price at the time of the initial offer.
However, the structure of the deal pointed to a break-up of the company. Under the proposed terms, Steel Dynamics would have taken control of BlueScope's lucrative North Star business in Ohio, USA, while SGH would have absorbed the Australian assets, headlined by the iconic Port Kembla steelworks in the Illawarra region of New South Wales.
Board and Market Reaction: 'Worth Considerably More'
BlueScope Chair Jane McAloon left no room for ambiguity in her rejection. "Let me be clear - this proposal was an attempt to take BlueScope from its shareholders on the cheap," Ms McAloon stated. "It drastically undervalued our world-class assets, our growth momentum, and our future - and the board will not let that happen."
She emphasised that this was the fourth rejection of Steel Dynamics and that BlueScope is "worth considerably more" than what was offered. Market analysts had anticipated this stance, interpreting BlueScope's initial disclosure as a tactic to solicit a higher bid. The market agreed, with BlueScope's share price soaring past $29 upon the bid's announcement, effectively erasing the premium offered by the Stokes consortium.
Ms McAloon pointed to the company's strong track record, noting that since a major restructure in the 2017 financial year, BlueScope has invested over $3.7 billion in growth projects and delivered more than $3.8 billion in returns to shareholders.
Union Fears and Strategic Intentions
The bid has raised significant concerns in the Illawarra, where the Port Kembla steelworks is a cornerstone of the local economy and community. South Coast Labour Council secretary Arthur Rorris expressed deep unease, warning against "asset stripping" and calling for long-term investment to meet carbon challenges.
"Our chief concern is the continuation of the Port Kembla steelworks and the employment of thousands of local workers directly and indirectly," Mr Rorris said. He also cited increased market volatility due to US tariff policies under President Trump as a factor making the industry more vulnerable.
Comments from SGH chief executive Ryan Stokes, son of Kerry, did little to allay these fears. He suggested that SGH's "disciplined operating model" could drive performance improvements in BlueScope's Australian business, a statement unions interpreted as a precursor to cost-cutting and potential job losses.
With major shareholders like Australian Super (12.5%) and L1 Capital (6.5%) now engaged, and BlueScope's rejection leaving the door open for a revised offer, the battle for control of Australia's industrial champion is far from over. All eyes are now on whether Kerry Stokes and Steel Dynamics will return with a sweetened proposal that the board, and the market, cannot refuse.
