The deal, which has an enterprise value of up to US$430 million, would pair the maker of alumina monolithics and basic and non-basic refractories with Austria’s RHIM, which has limited ability to sell U.S.-made products in the U.S. 

“Approximately 50% of RHI Magnesita’s U.S. sales are not produced in the country. The acquisition will increase RHI Magnesita’s local production in the U.S. and Canada by transferring significant volumes of production from non-U.S. plants to the Resco production facilities in the U.S. Based on customer feedback, we are taking steps to improve supply chain security, reduce production lead times, and stabilize working capital,” the company said in a statement. 

RHI Magnesita chief executive officer Stefan Borgas said the acquisition is a step-change for RHIM’s U.S. business and its North American production footprint. 

“The acquisition advances our ‘local for local’ production strategy and will shorten supply chains, improve our speed of reaction, and increase the security of supply of refractories for our customers. We are listening to our customers and responding to their desires.”

Resco operates seven refractory plants and two raw material sites, with two plants also located in the U.K. and Canada.

The deal is expected to be completed in the second half of this year.