Brazil's CSN agrees $2.3 billion deal set to sell cement unit to China's Huaxin

BRASILIA, Nov 8 (Reuters) - Brazil's CSN has signed an agreement to sell its cement unit, CSN Cimentos, to China's Huaxin in a deal valuing the business at 12.7 billion reais ($2.31 billion) on an enterprise-value basis, it said on Sunday.

In a securities filing, the steelmaker said the transaction agreed on Saturday was a step in its strategy to reduce debt and optimize its capital structure.

It is subject to customary closing conditions, CSN said, including approval from Brazil's antitrust regulator Cade, prior consent from power regulator Aneel and applicable Chinese regulatory approvals.

According to a translation of a separate filing by Huaxin, the Chinese company is expected to pay about 9.03 billion reais ($1.64 billion) for a 99.99% stake in CSN Cimentos, reflecting the target's agreed enterprise value after adjustments for debt and working capital.

Huaxin said CSN Cimentos accounts for about 21% of Brazil's cement market, adding that the acquisition would mark the first entry of a Chinese cement producer into the country. If completed, it would rank among the largest Chinese industrial acquisitions in Brazil's building materials sector, it added.

CSN, one of Brazil's largest steelmakers and iron ore miners, disclosed the valuation in late October, when it announced a 10-day exclusivity agreement with Huaxin to negotiate the sale.

It has been seeking to cut debt and increase earnings as it faces a weak steel market and pressure from low-cost imports, particularly from China.

The company made public a divestment plan in January that included the cement business.

Huaxin submitted the winning bid for CSN Cimentos in a competitive process launched in March 2026, according to previous company disclosures.

($1 = 5.5053 reais)