Esmark Steel Group Acquires Assets of Kelco Metals
10/21/2010 - Esmark Steel Group has acquired the assets of Schaumburg, Ill.-based steel distributor Kelco Metals Inc. for more than $9 million. Kelco Metals will add approximately 50,000 tons of steel shipments annually to the company’s total shipments.
Esmark Steel Group has acquired the assets of Schaumburg, Ill.-based value-added steel distributor Kelco Metals Inc. for more than $9 million.
The acquisition of Kelco Metals’ steel distribution assets will expand Esmark Steel Group’s footprint to the Southeastern U.S. and contribute revenue and customers toward the company’s stated 2011 revenue goal of $300 million.
Earlier this year Esmark Steel Group acquired the assets of Century Steel and Sun Steel. All of the service centers are now wholly-owned subsidiaries of Esmark Steel Group, headquartered in Chicago, and will join Chicago Steel & Iron (formerly Amtex Steel Inc.) in the Esmark Steel Group service center portfolio.
Esmark Steel Group’s operating companies have combined annual steel shipments of approximately 300,000 tons of flat-rolled, value-added products. Kelco Metals will add approximately 50,000 tons of steel shipments annually to the company’s total shipments.
James P. Bouchard, Chairman and Chief Executive Officer of Esmark Inc., said the acquisition of Kelco Metals is a strong strategic fit with Esmark Steel Group’s portfolio of service centers in the Midwest and Northeast. “Kelco meets our acquisition criteria and opens up new markets for us in the Southeastern U.S. We believe the addition of Kelco’s distribution business will be very complementary to our growing service center network.”
With annual revenue of approximately $45 million, Kelco Metals Inc. specializes in hot-rolled, cold-rolled, and coated steel products serving OEMs in the agricultural equipment, office equipment, retail display, tools, shelving, and lighting fixture industries. The company, which has been in business for more than 17 years, currently maintains offices in Schaumburg, Ill., and Charleston, S.C., and employs approximately 15 people.
Esmark Steel Group, a wholly owned subsidiary of Esmark, Inc., was formed in November 2009 to identify and pursue strategic acquisitions in the steel service center sector in the Midwest. The formation marked a return to the steel industry since Esmark sold its Wheeling-Pittsburgh Steel Corp. and network of 10 Midwest service centers to OAO Severstal in July 2008 for $1.23 billion. In addition to its $10 million acquisition of Amtex Steel in November 2009, Esmark also acquired Meadville, Pa.-based Excalibur Machine Co., Inc. for $3.5 million in cash.
