A. M. Castle & Co. and Duferco Steel, Inc. Announce Ownership Transfer of Kreher Steel Business
August 08 2016 - 5:51PM
A. M. Castle & Co. (NYSE:CAS) (“Castle”), a global distributor
of specialty metal and supply chain solutions, and Duferco Steel,
Inc. (“Duferco”), an international steel and steel-making raw
materials commodities trading organization, jointly announced today
that the two companies have reached an agreement by which Castle
will sell its 50% joint venture ownership in the partners’ Kreher
Steel business (“Kreher”), to Duferco. Upon completion of this
transaction, which is subject to customary closing and
documentation conditions, Duferco will become the 100% owner of
Kreher. Castle will receive approximately $31.6 million as a
result of the transaction, with the sale expected to close on
August 22th, 2016.
Steve Scheinkman, President and CEO of A. M.
Castle commented, “While we have enjoyed a long-standing and
valuable partnership with Duferco, Castle’s decision to divest its
interest in Kreher, which has significant business in the Oil &
Gas end market, is in line with our recent streamlined focus on the
Industrial and Aerospace markets. The sale will allow us to direct
our full attention on getting closer to our customers in those end
markets, growing our business and improving our profitability over
the long-term. We want to thank the management and employees of
Kreher for their contributions to Castle over the years, and wish
them well. Similarly, we wish Duferco the best with the
Kreher business, as they have been a constructive partner over the
years.”
Matthew De Morgan, CEO of Duferco International
Trading Holding concluded, “For our part we are delighted to be
offered this opportunity to increase our stake in Kreher. Castle's
decision to focus more the Industrial and Aerospace end markets has
in fact dovetailed nicely with our strategy to increase our
exposure to the US Oil & Gas sector. Kreher enjoys a strong and
experienced management team with an enviable performance record,
both in terms of returns for the shareholders as well as the care
and attention paid to their customers and suppliers. We will fully
support Kreher’s management team to continue growing the business
and thank all Kreher's stakeholders for their continued loyalty to
the company."
About A. M. Castle &
Co.
Founded in 1890, A. M. Castle & Co. is a
global distributor of specialty metal and supply chain services,
principally serving the producer durable equipment, aerospace,
heavy equipment, industrial goods, construction equipment, and
retail sectors of the global economy. Its customer base includes
many Fortune 500 companies as well as thousands of medium and
smaller-sized firms spread across a variety of industries. The
Company specializes in the distribution of alloy and stainless
steels, nickel alloys, aluminum and carbon. Together, Castle and
its affiliated companies operate out of 21 service centers
throughout North America, Europe and Asia. Its common stock is
traded on the New York Stock Exchange under the ticker symbol
"CAS".
About Duferco Group
Duferco International Trading Holding S.A.
(DITH) is an international steel and steel-making raw materials
commodities trading organization, with its global headquarters in
Lugano, Switzerland. It was first founded in Brazil in 1979. Today,
DITH is one of the world’s largest steel and raw materials trading
and distribution companies, with sales of circa 20 million metric
tons of steel and raw materials in 2015. The organization has a
network of offices in 76 locations and commercial activities in
over 120 countries around the world and enjoys one of the largest
distribution and processing networks in the sector, selling 3.35
million metric tons per annum of steel to over 44,000 customers
worldwide. These distribution facilities provide tailored services
to a broad cross-section of industries including automotive, oil
and gas, mining, residential and industrial construction, OEM, high
value engineering uses and white goods manufacturing. For further
information, visit www.duferco.com
For Further Information:
-At ALPHA IR-
Analyst Contact
Chris Donovan or Chris Hodges
(312) 445-2870
Email: CAS@alpha-ir.com