Dofasco Tubular to Sell Elizabethtown Tube Facility to Samuel Manu-Tech
08/09/2007 - Dofasco Tubular Products signs definitive purchase agreement for the sale of its Elizabethtown stainless tubemaking facility to Samuel Manu-Tech of Mississauga, Ont.
Dofasco Tubular Products Corp. has signed a definitive purchase agreement for the sale of its Elizabethtown, Ky., stainless tubemaking facility to Samuel Manu-Tech Inc. of Mississauga, Ont.
The purchase price, U.S. $28.5 million, is subject to certain adjustments for working capital items.
"Combined with our flagship Associated Tube Industries facility located in Markham, Ont., and our new greenfield site, Tubos Samuel de Mexico located in Saltillo, Mexico, this acquisition is an important step in broadening Samuel's existing stainless steel tubular products capability and geographic reach throughout North America and Mexico," said Mark Samuel, Samuel's Chairman and CEO. Samuel will operate Elizabethtown within the Samuel Tube Group under the name Associated Tube USA Inc.
Elizabethtown is a leading manufacturer of stainless steel laser welded tubular products located in Elizabethtown, Ky. Its sales for the first six months of 2007 were approximately U.S. $16 million. Samuel Manu-Tech management expects this acquisition to be accretive to earnings in its first full year of operations.
Dofasco Tubular Products pursued the sale of its Elizabethtown stainless steel tubing facility in order to focus on its core carbon steel businesses of Mechanical and Automotive tubing. The decision to sell followed the company’s strategic and operational review of its entire business
“We are pleased to be able to sell this facility to a company of Samuel Manu-Tech's reputation and expertise,” said Bill Chisholm, President of Dofasco Tubular Products. “Although stainless tubing did not fit with our core business, it is a specialty product that is an excellent fit with the Samuel portfolio."
Samuel Manu-Tech will fund the acquisition from its existing revolving-credit facilities. The transaction, which is subject to customary closing conditions, is expected to close in the next few days.
Dofasco Tubular Products is a wholly owned subsidiary of Dofasco Inc. a leading North American steel solutions provider and member of the ArcelorMittal group. Product lines include hot rolled, cold rolled, galvanized, Extragal(TM), Galvalume(TM) and tinplate flat rolled steels, as well as tubular products and laser-welded blanks. Dofasco's wide range of steel products is sold to customers in the automotive, construction, energy, manufacturing, pipe and tube, appliance, packaging and steel distribution industries.
Samuel Manu-Tech Inc. is a leading North American industrial products and technology company producing a wide range of steel, plastic and related industrial products and services from locations in Canada, the United States and Mexico.
