AustralianSuper Backs BlueScope in Rejecting A$30 Takeover Offer

AustralianSuper said it would support BlueScope’s board after the steelmaker formally rejected a takeover approach that offered A$30 per share. The fund disclosed it had increased its holding in BlueScope from 12.5 percent to 13.52 percent and directly challenged the valuation implied by the approach, saying the offer “does not reflect what we presently believe is the underlying value of the business.” AustralianSuper added, “We support the BlueScope board’s decision to reject the offer and to remain focused on executing the company’s strategy without distraction.” The fund made clear it would “only support a transaction that was materially higher than the price of A$30 per share currently proposed.”

BlueScope said the proposal “very significantly undervalued” the company, accusing the bidders of trying to buy the business “on the cheap.” The A$30-per-share proposal equated to A$13.2 billion, or about US$8.8 billion on one conversion, and has been widely discussed in U.S. dollar terms at roughly $9 billion. The consortium that tabled the offer is led by U.S. steelmaker Steel Dynamics and Australian conglomerate SGH Ltd.

Shares in BlueScope reacted sharply when the approach became public. The stock surged more than 20 percent on the initial market response, climbing to just under A$30 before settling back to around A$29 after the company’s rejection. The price action reflected investor hopes of a potential takeover premium, followed by recalibration as major shareholders signaled they would not accept the initial offer.

The suitors’ playbook is strategic as well as financial. Steel Dynamics has previously pursued BlueScope assets in North America and has sought to capitalize on steep tariffs imposed in recent years that have insulated domestic U.S. steelmakers. For BlueScope, which operates an integrated steel business across Australia and North America, the bid posed questions about control over valuable manufacturing footprint and the pricing of long-term domestic demand.

AustralianSuper’s public intervention illustrates a broader shift in the role of large pension funds in corporate deals. Institutional investors in Australia have become more willing to press for higher takeover prices, citing long-term valuation frameworks and strategic national interest. A recent high-profile example saw the same pension fund oppose a major offer for a large energy company on the grounds it undervalued future cash flows.

With BlueScope’s board united in rejecting the initial approach and a top shareholder demanding a materially higher price, the immediate outlook is for concentrated negotiations rather than an imminent sale. BlueScope, SGH and Steel Dynamics had not provided further public comment beyond initial statements. Market participants will now watch whether the consortium raises its offer, withdraws, or pivots to targeted asset purchases, while investors and policymakers weigh the implications for overseas capital flows into strategic Australian industries.