Ternium's Strategic Deepening of Usiminas Control: A Pathway to Enhanced Steel Market Dominance in Brazil

In November 2025, Ternium made a decisive move to consolidate its grip on Brazil's steel industry by acquiring the remaining shares in the control group of Usiminas held by Nippon Steel and Mitsubishi. This $315.2 million transaction, executed at $2.06 per ordinary share, elevated Ternium's stake from 51.5% to 83.1%, with the T/T group (comprising Ternium Investments, Ternium Argentina, and Confab) now controlling 92.9% of voting rights in the control group, according to a Ternium announcement. The acquisition, funded entirely by cash reserves, underscores Ternium's commitment to leveraging ownership consolidation as a strategic tool to amplify governance influence and operational control in capital-intensive industries.

The transaction's implications extend beyond mere shareholding percentages. By securing a near-monopoly in Usiminas' governance, Ternium has positioned itself to dictate strategic decisions, from capital allocation to technological innovation. This aligns with broader trends in the global steel sector, where ownership concentration is increasingly viewed as a catalyst for efficiency and market dominance. For instance, Nippon Steel's recent $14.1 billion acquisition of U.S. Steel-despite its current challenges-demonstrates how ownership consolidation can unlock value through operational overhauls and long-term investments, as noted in the Flat Steel Trends 2025 report. Ternium's approach, however, appears more focused on preserving local stakeholder involvement, as evidenced by the retention of Previdência Usiminas' 7.1% stake, a move that balances control with social responsibility.

The Brazilian steel market, valued at a significant portion of the global $520.03 billion flat steel sector in 2024, is poised for growth driven by infrastructure expansion and green steel initiatives. Ternium's deepened control over Usiminas places it at the forefront of these trends. By centralizing decision-making, the company can accelerate investments in low-carbon production methods, such as hydrogen-based direct reduced iron (DRI), which are critical for meeting global decarbonization targets, according to the report. This strategic alignment with sustainability goals not only strengthens Ternium's competitive edge but also mitigates regulatory risks in an industry under increasing environmental scrutiny.

Yet, the path to dominance is not without hurdles. Brazil's antitrust authorities must approve the transaction, a process that could delay implementation. Additionally, the global steel market faces headwinds, including fluctuating demand and supply chain disruptions. The report also highlights Nippon Steel's recent exclusion of U.S. Steel from its profit guidance, underscoring the volatility of such investments in markets with high operational complexity. Ternium's reliance on cash reserves to fund the acquisition, while prudent, also limits its flexibility to respond to unforeseen market shifts. Investors must weigh these risks against the potential rewards of a more centralized and agile governance structure.

In the broader context of capital-intensive industries, Ternium's strategy reflects a growing preference for governance leverage as a tool to navigate competitive landscapes. By consolidating control, firms can streamline operations, reduce bureaucratic inefficiencies, and accelerate innovation-a formula that has proven successful in sectors ranging from energy to manufacturing. However, the balance between control and collaboration remains delicate. Ternium's retention of Previdência Usiminas' stake suggests an awareness of this dynamic, ensuring that local interests remain aligned with corporate objectives.

As the global steel industry evolves, Ternium's acquisition of Usiminas' control group serves as a case study in strategic ownership consolidation. The company's ability to translate this control into operational excellence and market leadership will depend on its execution of post-acquisition initiatives, regulatory outcomes, and adaptability to macroeconomic trends. For investors, the transaction highlights the importance of governance structure in capital-intensive sectors-a factor that could redefine competitive advantages in the years ahead.