Gerdau to Acquire Tamco
09/16/2010 - Gerdau S.A.’s wholly owned subsidiary, Gerdau Ameristeel, has entered into a definitive agreement with Ameron International, Tokyo Steel, and Mitsui & Co. (U.S.A.), Inc. to acquire all the issued and outstanding shares of Tamco. The transaction is expected to close in the fourth quarter of 2010.
Gerdau S.A.’s wholly owned subsidiary, Gerdau Ameristeel, has entered into a definitive agreement with Ameron International, Tokyo Steel, and Mitsui & Co. (U.S.A.), Inc. to acquire all the issued and outstanding shares of Tamco, a California corporation.
Subject to certain closing adjustments, the purchase price for Tamco is approximately US$165 million in cash. Ameron agreed to sell its 50% ownership of Tamco, an unconsolidated affiliate, for $82.5 million in cash, before transaction costs and working capital adjustments. Mitsui & Co. (U.S.A.), Inc. and Tokyo Steel also agreed to sell the remaining 50% interest in Tamco to Gerdau for an additional $82.5 million.
Houlihan Lokey is assisting as investment banker for the transaction. The transaction is expected to close in the fourth quarter of 2010.
Tamco is a mini-mill steel producer of reinforcing steel bar and is one of the largest rebar mills in the Western U.S. with annual capacity of approximately 500,000 tonnes. Based in Rancho Cucamonga, Calif., Tamco is the only producer of long steel products in that state and serves markets primarily in California, Arizona, and Nevada.
According to Andre B. Gerdau Johannpeter, President and CEO of Gerdau S.A, "Tamco will expand Gerdau’s network of mini-mills in North America, increasing our geographical footprint into the Western U.S., and our capability to serve the civil construction market in that region.”
Gerdau is the leading producer of long steel in the Americas and one of the largest suppliers of specialty long steel in the world. It has more than 40,000 employees and industrial presence in 14 countries, with operations in the Americas, Europe and Asia, which, combined, have an installed capacity of more than 25 million tonnes of steel. It is the largest recycler in Latin America.
