Interview With The Steel Index' Virginia Mainwaring on Platts Acquisition

Following an article we ran last week on the merger of Steel Business Briefing/The Steel Index (TSI) with Platts, we caught up with Virginia Mainwaring of TSI London to address some points our readers had raised about the merger.

MM: One of the expectations in the market place is that there will be winners and losers from the Platts – SBB merger, indeed if there is not to be some rationalization what is the point of the merger?

VM: This deal is about growth and  increasing the  value provided to the steel industry, not about winners and losers.   The objective is that the whole should be greater than the sum of the parts.  The intention is to integrate Steel Business Briefing (SBB) into Platts, with the benefits that will bring, whilst keeping The Steel Index (TSI) as a separate entity within Platts to continue, and even accelerate, its growth trajectory.

MM: Can you explain for our readers the strategy going forward for the merged business?

VM: This acquisition is about bringing additional value to customers and the marketplace. Platts intends to build upon the success of SBB and TSI, supporting its strategic objective of expanding its presence in the global steel markets. By joining forces, the aim is to offer the market a more expansive product mix that better serves the growing demand for timely, objective information on the steel industry. The work that TSI has done in establishing reliable price indices has met with significant market acceptance. TSI’s indices will continue to be developed using its current methodology and published in TSI’s current publications, independently from Platts price assessments.

MM: Many see this simply as Platts taking a rising competitor out of the way, surely there is an element of that in the merger?

VM: That may be a perception, but the reality is that this is about combining forces to serve the market even better. The union of Platts with SBB will give the market the benefit of a larger, highly experienced editorial team and a far more expansive product mix covering steel and its raw material commodities. TSI will continue to provide its price indices independently, under the TSI brand, as it has done previously.

MM: To what extent is this a reaction to Platts as being light in ferrous metals?

VM: Platts, SBB and TSI provide complementary news and price services aimed at mining companies, steel producers and other organizations in the steel supply chain.  By bringing SBB’s and TSI’s extensive portfolio of of quality news and pricing services together with Platts’ existing resources and products, the objective is to reinforce a strong commitment to steel and its related markets.

MM: How will SBB and Platts journalistic independence be maintained?

VM: SBB and Platts’ journalism/editorial and pricing activities will be integrated, while TSI’s pricing business remains separate. The confidentiality of TSI’s data providers and the price data they submit to TSI remains assured – Platts businesses will have no access to this. In short, TSI’s processes and commitments to its clients are unaffected.

MM: Both Platts and SBB’s subsidiary TSI run steel indexes. We have heard the rapid acceptance of TSI heralds a changing of the order. How do you see the adoption of one or the other price source in the market place?

VM: The market will continue to be offered both TSI’s and Platts’ price indices, allowing participants to use the indices that best serve their purposes. TSI will continue with its own team, totally independently from any of Platts’ journalistic and pricing activities. Platts and TSI indices are compiled using different methodologies; Platts employs a system of telephone polling to arrive at daily market price assessments, whilst TSI collects daily transaction data from hundreds of market participants via a secure on-line system and calculates daily volume-weighted average prices based on this data. The expectation is that both sets of indices will continue to be used in the market place.

–Stuart Burns

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