Gerdau Ameristeel Announces Agreement to Acquire Century Steel
02/13/2008 - Pacific Coast Steel, a majority owned Gerdau Ameristeel joint venture, will acquire all the assets of Las Vegas-based Century Steel Inc. for consideration totaling $151.5 million.
Gerdau Ameristeel’s majority owned joint venture, Pacific Coast Steel, has signed a definitive agreement to acquire all the assets of Century Steel, Inc. for consideration totaling $151.5 million.
Century Steel is reinforcing and structural steel contractor headquartered in Las Vegas, Nev. Specializing in the fabrication and installation of structural steel and reinforcing steel products, the company operates reinforcing and structural steel contracting businesses in Nevada, California, Utah and New Mexico. Century Steel’s fabrication facilities have a combined annual capacity in excess of 250,000 tons per year.
"This transaction supports our strategy for continued growth in the downstream business,” " remarked J. Neal McCullohs, Vice President of Commercial and Downstream Operations for Gerdau Ameristeel. “Century is a fine company with a long history of success in the fabrication and in-place business. With proven leadership, superior customer service, and excellent fabrication facilities, they will bring immediate value to our PCS joint venture, as well as the Gerdau Ameristeel mills.
Gerdau Ameristeel also announced that, concurrently with the acquisition of Century, Gerdau Ameristeel will pay approximately $68.0 Million to increase its equity participation in the PCS joint venture to approximately 84%.
“Our venture on the west coast has been extremely successful and we are excited about the opportunities Century brings and about our increasing participation in the venture,” commented Mario Longhi, Gerdau Ameristeel’s President and CEO. “As with PCS, we found that Century Steel has a strong management team with core values consistent with ours. The transaction is expected to be immediately accretive to our earnings."
The transaction, which is subject to customary closing conditions, including regulatory approval, is expected to close before the end of the first quarter.
Gerdau Ameristeel is the second-largest mini-mill steel producer in North America with annual manufacturing capacity of approximately 12 million tons of mill finished steel products. Through its vertically integrated network of 19 minimills (including one 50% owned joint venture minimill), 19 scrap recycling facilities, and 61 downstream operations, Gerdau Ameristeel serves customers throughout North America. The company's products are generally sold to steel service centers, steel fabricators, or directly to original equipment manufactures for use in a variety of industries.
