Fitch rates Steel Dynamics revolver, notes BBB

Fitch Ratings said it assigned a BBB rating to Steel Dynamics, Inc.’s new $1.2 billion senior unsecured revolver maturing 2024. Fitch also assigned a BBB rating to the company’s new issuance of senior notes. The outlook is stable. Steel Dynamics intends to use the proceeds for general corporate purposes including, without limitation, to refinance its $700 million 2021 senior notes.

“The ratings reflect Steel Dynamics’ significant size and diversified product mix, in addition to its flexible, low cost structure, vertically integrated business model focused on pull-through volumes, industry leading domestic capacity utilization rates and strategic focus on expanding its value-add product mix. These collectively support the company’s high EBITDA margins. The ratings also reflect the company’s low leverage, with total debt/EBITDA generally remaining below 2x over the past few years. Fitch forecasts the ratio to remain below 2.5x through the ratings horizon,” said Fitch in a news release.

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