NX Quanex Corp

NEW YORK, July 31 /PRNewswire/ -- Despite Mittal's acquisition of Arcelor, Standard & Poor's Equity Research Services sees the global steel industry further consolidating over the next several years. These and other findings are available in a semi-annual report on the metals industry, Metals: Industrials Industry Survey, published by Standard & Poor's, a leading provider of independent investment research. Standard & Poor's Equity Research sees the following companies as potential acquisition candidates, Commercial Metals (NYSE:CMCNYSE:$22.04****), Quanex Corp. (NYSE:NXNYSE:$36.35****) and Steel Dynamics (NASDAQ:STLDNASDAQ: $57.91***). In our opinion, Commercial Metals has attractive assets in steel manufacturing, steel fabrication and scrap recycling. Quanex appears attractive for its strong market position in engineered steel bar and its ample free cash flow. Steel Dynamics has low-cost steel-making operations and a diversified product mix serving the automotive, distributor and nonresidential construction markets. There are several companies in this industry that we believe have the financial wherewithal to make acquisitions. According to Standard & Poor's Equity Research, the most likely acquirers would be Nucor Corp. (NYSE:NUENYSE: $51.60****) and U.S. Steel (NYSE:XNYSE:$62.48****). Both of these companies may be looking to improve and expand its capabilities in certain markets. "Sharply rising costs for raw materials such as iron ore and ferrous scrap are creating pressure for companies to merge. Steel producers have to become larger in order to have greater clout to obtain more favorable contracts from the iron ore miners. Also, larger companies would have the greater financial strength required to engage directly in iron ore mining or manufacture substitutes for ferrous scrap," said Leo Larkin, Senior Metals and Mining Analyst, Standard & Poor's Equity Research Services. "The imperative to reduce raw material costs will, in our opinion, result in further industry consolidation." Standard & Poor's Industry Surveys provide a broad and fundamental overview of each industry's structure, its recent performance, and an analysis of trends that are expected to influence it in the future. Each Survey is organized into the following sections: Current Environment, Industry Profile/Industry Trends, How the Industry Operates, Key Industry Ratios and Statistics, How to Analyze a Company, Industry References, Comparative Company Analysis, and a Glossary of terms used in that industry. Both text and data are provided, as are references to additional sources of industry information. Two surveys on each industry are published each year. Readers can purchase Standard & Poor's Industry Surveys three ways: Online for immediate download at http://sandp.ecnext.com/, by telephone at 212-438-4052, or via e-mail order sent to . Members of the media can request a copy from the communications contact listed at the end of this release. The analyst quoted above is a Standard & Poor's equity analyst. He has no affiliation with any company he covers, nor any ownership interest in any companies he covers. About Standard & Poor's Equity Research Services As the world's largest producer of independent equity research, over 1,000 institutions license Standard & Poor's research for their investors and advisors, including 19 of the top 20 securities firms, 13 of the top 20 banks, and 11 of the top 20 life insurance companies. Standard & Poor's team of 120 experienced U.S., European and Asian equity analysts use a fundamental, bottom-up approach to assess a global universe of approximately 2,000 equities across more than 120 industries worldwide. Follow Standard & Poor's equity analysts' U.S. market commentary each day at http://www.equityresearch.standardandpoors.com/. The equity research reports and recommendations provided by Standard & Poor's Equity Research Services are performed separately from any other analytic activity of Standard & Poor's. Standard & Poor's Equity Research Services has no access to non-public information received by other units of Standard & Poor's. Standard & Poor's does not trade on its own account. The analytical and ethical conduct of Standard & Poor's equity analysts is governed by the firm's Research Objectivity Policy, a copy of which may also be found at http://www.standardandpoors.com/. About Standard & Poor's Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 7,500 employees, including wholly owned affiliates, located in 21 countries, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com/ DATASOURCE: Standard & Poor's CONTACT: Ed Sweeney Communications Tel.: 212-438-6634 Web site: http://www.standardandpoors.com/ http://www.equityresearch.standardandpoors.com/ http://sandp.ecnext.com/

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