Russel Metals Inc. announces that it has entered into an agreement to acquire a group of companies that operate as Boyd Metals (“Boyd”) for US$110 million, subject to closing adjustments.
Boyd operates five service centers in Fort Smith (Arkansas), Little Rock (Arkansas), Joplin (Missouri), Oklahoma City (Oklahoma) and Tyler (Texas). Boyd’s product mix is primarily comprised of carbon steel products, but also includes stainless steel, aluminum and other related industrial products. Boyd also offers value-added processing services and has invested to expand such capabilities over the past several years. For the twelve months ended September 30, 2021, Boyd generated revenues of US$244 million and Adjusted EBITDA1 of US$39 million.
John Reid, President and CEO of Russel commented, “Over the past 15 months, we have significantly repositioned our business portfolio with the strategic objectives of enhancing returns, increasing margins and reducing volatility. As part of this strategy, we have: (i) repatriated approximately $300 million of capital through the monetization of our OCTG/line pipe businesses; (ii) invested in value-added equipment in our existing service center operations; and (iii) pursued acquisition opportunities that are complementary with our existing platform, including the acquisition of Sanborn Tube in late 2020. The acquisition of Boyd is a continuation of this repositioning. We believe their culture, experienced management team and business platforms are very much aligned with our existing business as we look to further expand our U.S service center footprint. We look forward to having all of the Boyd employees as part of the Russel family.”
The purchase price of US$110 million includes working capital, buildings and equipment, real estate and other related assets.
Courtesy of Russel Metals.