Steel Dynamics, Inc. has entered into a definitive agreement to acquire The Techs, a Pennsylvania-based flat-rolled-steel galvanizing company. The company includes three hot-dip galvanizing facilities in the Pittsburgh, PA, area. Steel Dynamics will pay $360 million for the company on a cash free debt free basis, subject to certain adjustments. The acquisition is expected to close on or about July 2, 2007.
The Techs business operations consist of three facilities, GalvTech, MetalTech and NexTech, each specializing in the galvanizing of specific types of flat-rolled steels. In 2006 the privately held company shipped 958,000 tons of galvanized steel and generated revenues of $811 million. The Techs specializes in non-automotive applications, serving a variety of customers in the HVAC, commercial construction, and consumer goods markets. About 85% of its sales are to customers in the eastern U.S. and the Midwest.
"The Techs represents an excellent opportunity for Steel Dynamics to expand its participation in the value-added steel coating business," said Mark Millett, President and COO for Flat Rolled Steels and Ferrous Resources. "Its management and employees have done a fine job building an outstanding company by focusing on quality and service, resulting in a very loyal non-automotive customer base.
"This additional business complements our three existing galvanizing lines at Butler and Jeffersonville, IN, which utilize steel sheet produced at our Butler mill. Like our existing operations, these plants process both hot- rolled and cold-rolled steel in a range of gauges. This acquisition will approximately double SDI's hot-dip galvanizing capacity," Millett said.
Steel substrate used by The Techs is expected to continue to be supplied by a variety of nearby suppliers, which have also, in the past, included SDI. The Techs' three modern, efficient facilities, constructed in 1984, 1990 and 1996, have a combined annual galvanizing capacity of about one million tons. Together, the three non-union facilities employ approximately 225 people. The plants will operate under their current management as The Techs, an independent Steel Dynamics business unit reporting to Millett.
For more information, visitwww.steeldynamics.com.
Steel Dynamics to Acquire The Techs - Posted 6/20/07
June 20, 2007