AK Steel, a producer of flat-rolled carbon, stainless, and electrical steel products, announced that it has signed an agreement to sell its wholly-owned subsidiary, Douglas Dynamics, LLC to DDL Acquisition Corporation, formed by Aurora Capital Group of Los Angeles, CA, U.S.
Douglas Dynamics is a manufacturer of snow and ice removal equipment with operations in Milwaukee, WI, Johnson City, TN, and Rockland, ME, U.S. Terms of the sale were not disclosed. The sale is subject to completion of the buyer's due diligence and customary closing conditions, as well as regulatory review. AK Steel said it expects to complete the sale by March 31.
In October of 2003, AK Steel announced its intention to sell Douglas Dynamics, along with the Greens Port Industrial Park located in Houston, TX, U.S. and to use the proceeds primarily to reduce debt. On Feb. 13, 2004, AK Steel announced that it had signed an agreement to sell the Greens Port Industrial Park to Greensport Management LLC. The sale of Greens Port is also expected to be completed by March 3.
AK Steel said it expects the two sales transactions to generate total cash proceeds of approximately U.S. $340 million after estimated fees and expenses, resulting in a pre-tax gain of approximately $250 million. At this time AK Steel said it does not anticipate any material income tax payments in conjunction with these transactions.
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