Steel Dynamics Inc. (Nasdaq: STLD), based in Fort Wayne, Indiana, and AK Steel Corp. (NYSE: AKS), based in Westchester, Ohio, are each buying a unit of Severstal OAO, headquartered in the Cherepovets, Russia.

The deals comes as Ford Motor Co. (NYSE: F) and other automakers choose aluminum over steel. Because aluminum is lighter, it leads to higher fuel efficiency. Ford plans to launch an aluminum F-150 by year's end and other automakers are expected to follow the trend as well. For more, see " The Buyside: Deals Abound as Ford Goes Aluminum."

Steel Dynamics is paying $1.6 billion for Severstal Columbus LLC, a producer of high-various steel sheet products for customers in several sectors, including construction and automotive. Separately, Steel Dynamics picked up Severstal's assets in northeast Mississippi, where the Columbus segment is one of the newer mills in North America.  The purchase is expected to boost Steel Dynamics' annual shipping capacity to 11 million tons.

Meanwhile, AK Steel takes over Severstal Dearborn LLC, a maker of flat-rolled steel products, for $700 million. Included in AK Steel's acquisition is  Severstal's cokemaking facility and interests in three joint ventures. Once the deal is completed, AK Steel's annual shipments are expected to exceed 7.5 million tons. CEO James Wainscott says the deal will advance the company's automotive strategy.

The units, which have been collectively doing business as Severstal North America and are known locally as Rouge Steel, were previously owned by Ford Motor Co. (NYSE:F). Rouge Steel had filed for bankruptcy in 2003, and Severstal acquired most of the assets in 2004.

Severstal — which has been losing money — announced a strategic review of assets in 2013, including the sale of PBS Coals Inc., which was recently acquired by Toronto-based Corsa Coal Corp. (CVE: CSO). PBS Coals manufactures metallurgical coal. The transactions enable the Russian company to exit from North America at a time when tensions between the two countries are particularly high. Evidence is mounting that  Russia supplied pro-Russian Ukrainian rebels with the weapon that shot down Malaysia Airlines Flight MH17 on July 17.

Credit Suisse advised AK Steel on the purchase, while Raymond Gietz, a partner at law firm Weil Gotshal & Manges LLP, handled legal matters.

Investment banks Evercore Partners Inc. (NYSE: EVR) and Citigroup Inc. (NYSE: C) are advising Severstal throughout the sale process. Gary Cullen and Shilpi Gupta, partners at law firm Skadden Arps Slate Meagher & Flom LLP, led a team of attorneys handling legal terms.

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