Brazilian Court Orders Tenaris to Pay an Indemnification in Connection with its Acquisition of a Participation in Usiminas in 2012
June 18 2024 - 12:59PM
Tenaris S.A. (NYSE and Mexico: TS and EXM Italy: TEN) announced
today that the Brazilian Superior Court of Justice (SCJ) resolved
that Tenaris’s subsidiary Confab and certain subsidiaries of
Tenaris’s affiliate Ternium, all of which compose the T/T Group
under the Usiminas shareholders agreement, should pay Companhia
Siderúrgica Nacional, or CSN, an indemnification in connection with
the acquisition by the T/T Group of a participation in Usiminas in
January 2012.
CSN and various entities affiliated with CSN had
filed a lawsuit in Brazil against the T/T Group, alleging that,
under applicable Brazilian laws and rules, the acquirers were
required to launch a tag-along tender offer to all non-controlling
holders of Usiminas ordinary shares for a price per share equal to
80% of the price per share paid in such acquisition.
On September 23, 2013, the first instance court
dismissed the CSN lawsuit, and on February 8, 2017, the court of
appeals upheld the first instance court decision. On March 7, 2023,
the SCJ rejected CSN’s appeal by majority vote. The composition of
the SCJ panel in charge of the case subsequently changed and CSN
made several submissions in connection with the SCJ decision,
including a motion for clarification with the SCJ that challenged
the merits of its earlier decision.
At today’s session, the SCJ completed its voting
on CSN’s motion for clarification and reversed, by majority vote,
its March 7, 2023 decision, and granted CSN an indemnification,
with CSN being allowed to retain ownership of the Usiminas ordinary
shares it currently owns. Depending on how the indemnification is
calculated by other courts, and assuming monetary adjustment and
interest through May 31, 2024, the potential aggregate
indemnification payable by Confab could reach up to BRL942 million
(approximately $180 million).
The Company continues to believe that all of
CSN's claims and allegations are groundless and without merit, as
confirmed by several opinions of Brazilian legal counsel, two
decisions issued by the Brazilian securities regulator in February
2012 and December 2016, the first and second instance court
decisions and the March 7, 2023 SCJ decision referred to above. The
Company also believes that today’s SCJ decision on CSN’s motion for
clarification is contrary to applicable substantive and procedural
law. Accordingly, once the SCJ written votes are made available,
Confab will file all available motions and appeals against the SCJ
decision.
Some of the statements contained in this press
release are “forward-looking statements”. Forward-looking
statements are based on management’s current views and assumptions
and involve known and unknown risks that could cause actual
results, performance or events to differ materially from those
expressed or implied by those statements. These risks include but
are not limited to risks arising from uncertainties as to future
oil and gas prices and their impact on investment programs by oil
and gas companies.
Tenaris is a leading global supplier of steel
tubes and related services for the world’s energy industry and
certain other industrial applications.
Giovanni
Sardagna Tenaris1-888-300-5432www.tenaris.com
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