BlueScope is poised to intensify its takeover defence, pointing investors to higher-value alternatives and a broader assessment of strategic options, said two sources familiar with the situation.

The sources said the emphasis will be on productivity, costs and land sales and that separating its North American business is an option as some shareholders have demanded so. They added that incoming chief executive Tania Archibald starts on 1 February and its FY26 half-year results are scheduled for 16 February.

The comments come after BlueScope earlier this month rejected a AUD 30 per share proposal from SGH and Steel Dynamics. It marked the fourth indicative bid from Steel Dynamics since late 2024. The rejection was quickly followed with an announced AUD 438m unfranked special dividend (AUD 1 per share). BlueScope also flagged its free cash generation is set to ramp up over the next 12-18 months as it works through the balance of its investment programme, with capex expected to fall by at least AUD 500m in FY27 relative to FY26.

SGH and Steel Dynamics have proposed to buy BlueScope and then sell its North American business to Steel Dynamics.

The sources expected the consortium to return with another proposal and noted that BlueScope is not running a sale process and will engage the suitors at what it considers a more serious proposal which, as this news service has reported, is in the high 30s and probably closer to AUD 40.

A third source familiar with the situation doubted any renewed approach would come ahead of the 16 February results and noted that Steel Dynamics has already pitched four proposals. He highlighted that tax benefits of the proposed SGH/Steel Partners structure are worth AUD 2-AUD 3 per share.

There has been much analyst coverage of the potential deal and most, if not all of it, is supportive of the board’s stance.

Morgan Stanley estimates a break-up valuation of AUD 30.50-AUD 40 per share based on an EV/EBITDA sum-of-the-parts basis. This includes an AUD 800m-AUD 1.3bn valuation for BlueScope’s property portfolio. It also estimates Steel Dynamics can extract around USD 260m is synergies.

Macquarie values BlueScope’s property at a far higher AUD 2.3bn, noting that BlueScope itself sees the value at AUD 2.8bn. The bank has raised its estimated takeover price to AUD 34.05 per share (from AUD 25.50 per share) which nets off the AUD 1 per share special dividend.

For its part, Jefferies believes the North American business is worth close to AUD 26 per share compared to Morgan Stanley’s estimate of AUD 25.94-AUD 33.77 per share.

BlueScope closed Friday at 30.47.

BlueScope and the consortium declined comment.