Russel Metals Inc. (TSX: RUS) announces that it has entered into an agreement to acquire Tampa Bay Steel Corporation ("Tampa Bay Steel") for US$79.5 million, subject to normal course adjustments. The purchase price includes working capital, buildings and equipment, and the related real estate. Tampa Bay Steel has a long standing and well-respected management team in the central Florida region, and its business includes significant value-added processing and non-ferrous products.
John Reid, President and CEO of Russel Metals commented, "Our approach to acquisitions is to focus on opportunities that are complementary from a product mix and geographic perspective, but also aligned with our performance-based and decentralized culture. We believe that the transaction is a strong fit as it will allow us to extend our footprint into the Florida market with an experienced management team and a culture that is aligned with ours. In addition, Tampa Bay Steel has invested approximately US$20 million in value-added equipment and facility expansion over the past three years, and has a platform for further growth within the Florida market. We look forward to having the Tampa Bay Steel employees join the Russel family."
Tampa Bay Steel generated average annual revenues and adjusted EBITDA1 of approximately US$115 million and US$13 million, respectively, over the past five years. The transaction will be financed from our cash on hand or drawings under our credit facility and is expected to close in December 2024.
