By Gabriel Araujo and Alberto Alerigi
SAO PAULO, Jan 15 (Reuters) - Brazilian steelmaker CSN said on Thursday it would kick off a major divestment plan involving significant assets, including its cement unit, as it aims to "definitively" address capital structure issues by reducing its debt.
The firm targets deleveraging between 15 billion and 18 billion reais ($2.78 billion to $3.34 billion) as part of a broader goal of doubling its core earnings over eight years.
Sao Paulo-traded shares of the company
rose as much as 4.9% after the announcement, but later reversed course to trade down 5%, making it one of the biggest decliners on the Bovespa benchmark stock index.
CSN is one of Brazil's largest steelmakers and miners, but has struggled in recent years with an elevated debt load and what the sector describes as cheap foreign steel, especially from China, "flooding" the local market.
JPMorgan analysts said the new strategic plan was positive, but warned that "execution is key."
CEO SETS DEBT CUT AS PRIORITY
CSN expects to sell control of its cement division and a significant stake in an infrastructure unit that owns railway and port assets, while assessing alternatives and potential partnerships to boost cash generation at its steel unit.
"It's not because they're bad businesses or unprofitable. On the contrary. But waiting longer doesn't make sense," CSN CEO Benjamin Steinbruch told analysts on a call, saying that lowering debt was the top priority.
The company's leverage as measured by net debt/earnings before interest, taxes, depreciation and amortization stood at 3.14x at the end of the third quarter of 2025. CSN's goal is to cut it to 1.0x within eight years.
"We've never committed ourselves in such a transparent and pragmatic way," Steinbruch said.
MINING DIVISION NOT FOR SALE
In addition to steelmaking, energy, logistics and cement assets, CSN also controls iron ore producer CSN Mineracao, which it said will continue to expand through "highly profitable projects," related to high-grade products.
CSN sold a minority stake in CSN Mineracao to Japan's Itochu Corp in late 2024, but CSN Chief Financial Officer Antonio Marco Rabello said on Thursday the company has no intention of selling an additional stake, describing the unit as a "major store of value."
($1 = 5.3863 reais)
(Reporting by Gabriel Araujo and Alberto Alerigi Jr.; Editing by Aidan Lewis, Susan Fenton and Paul Simao)
