CHARLOTTE, N.C., Sept. 19,
2016 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) announced
today that it has agreed to acquire Independence Tube Corporation
(ITC), a leading independent manufacturer of hollow structural
section (HSS) steel tubing, for $435
million, or approximately 6x average EBITDA over the
2013-2015 period.
"Independence Tube is a natural fit with Nucor. Their business
model is similar to ours with extremely efficient manufacturing
facilities and a highly variable cost structure. Our companies'
cultures are also similar, sharing a belief in continual
improvement, operating efficiency and the value of our employees,"
said John Ferriola, Chairman, CEO
and President of Nucor. "This acquisition is another important step
in our long-term strategy to increase the number of value-added
products we can offer our customers. It also adds to our portfolio
another growth platform for our team to use to grow our
company."
HSS is used in a broad array of structural and mechanical
applications including nonresidential construction, infrastructure,
and agricultural and construction equipment end-use markets. ITC
has the second highest market share in HSS, selling its products
primarily through service centers, which are also an important
channel to market for Nucor. ITC is primarily a producer of
HSS and does not focus on products for energy or other pipe and
tube segments. The addition of ITC to Nucor's portfolio will allow
Nucor to offer a wider selection of products to its fabricator and
service center customers and strengthens the company's presence in
the key nonresidential construction market.
ITC and Nucor are highly complementary. Nucor is
installing a large diameter tube mill at an existing facility in
Iuka, Mississippi. Adding large size HSS to ITC's already
comprehensive product line will create the widest product offering
in North America for HSS
solutions. Nucor is North
America's most comprehensive provider of steel solutions to
the construction and infrastructure markets with leadership
positions in plate, bar and structural steels, as well as joist,
decking, metal buildings and rebar fabrication. The addition
of HSS further differentiates Nucor from its steel competitors as
the leader in providing solutions to its customers.
ITC operates four strategically located state-of-the-art
facilities in Illinois and
Alabama that annually produce
roughly 600,000 tons and employ approximately 335 teammates. ITC
purchases hot-rolled coil from suppliers to produce its HSS steel
tubing. The company's manufacturing plants are located in close
proximity to Nucor's sheet mills in Decatur, Alabama; Crawfordsville, Indiana; and Ghent, Kentucky.
Nucor and its affiliates are manufacturers of steel products,
with operating facilities primarily in the U.S. and Canada.
Products produced include: carbon and alloy steel -- in bars,
beams, sheet and plate; steel piling; steel joists and joist
girders; steel deck; fabricated concrete reinforcing steel; cold
finished steel; steel fasteners; metal building systems; steel
grating; and wire and wire mesh. Nucor, through The David J.
Joseph Company, also brokers ferrous and nonferrous metals, pig
iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and
nonferrous scrap. Nucor is North
America's largest recycler.
Certain statements contained in this news release are
"forward-looking statements" that involve risks and
uncertainties. The words "believe," "expect," "project,"
"will," "should," "could" and similar expressions are intended to
identify those forward-looking statements. Factors that might
cause the Company's actual results to differ materially from those
anticipated in forward-looking statements include, but are not
limited to: (1) competitive pressure on sales and pricing,
including competition from imports and substitute materials; (2)
the sensitivity of the results of our operations to prevailing
steel prices and the changes in the supply and cost of raw
materials, including scrap steel; (3) market demand for steel
products; and (4) energy costs and availability. These and
other factors are discussed in Nucor's regulatory filings with the
Securities and Exchange Commission, including those in Nucor's
fiscal 2015 Annual Report on Form 10-K, Item 1A. Risk
Factors. The forward-looking statements contained in this
news release speak only as of this date, and Nucor does not assume
any obligation to update them.
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SOURCE Nucor Corporation