Tokyo-based Metal One Corporation has reached an agreement to acquire the U.S. metals business from Cargill, Minneapolis. The two parties expect to close the transaction later this year.
The agreement includes Cargill’s U.S. metals supply chain business, which includes commercial activities based in Minneapolis and Houston, as well as eight processing facilities in seven U.S. cities: Windsor, Colo.; Panama City, Fla.; Granite City, Ill. (two facilities); East Chicago, Ind.; Tulsa, Okla.; Loudon, Tenn.; and Houston. Metal One will establish a wholly owned subsidiary in the U.S. to manage the new business.
In North America, Metal One already operates Coilplus Inc., a flat-rolled specialist headquartered in Rosemont, Ill. Coilplus operates 11 stocking locations, with 2016 revenues of $1.27 billion. It was the 12th-largest service center company in North America in Metal Center News’ most recent Top 50.
Cargill has also been a fixture in the Top 50, though the company was a non-respondent to this year’s survey. In the 2016 Top 50, Cargill ranked 25th, with 2015 revenues of $510 million.
“We are pleased to find a strategic buyer in Metal One which has a focus in the ferrous industry and an intent to grow and expand in North America,” says David Dines, president of Cargill Metals & Shipping. “While no longer owning steel processing centers, Cargill will continue to be active in global ferrous markets, offering tailored physical supply and financial solutions in iron ore and steel through our business in the Asia Pacific region.”
Currently Metal One has extensive capabilities in steel distribution throughout the U.S., and the acquisition will enable Metal One to expand and diversify its operations by adding a proven business to the company’s growing portfolio, company officials claim.
“This acquisition will be a great strategic fit with our current asset base in North America,” says Shuichi Iwata, president and CEO of Metal One. “We will provide continuous support for the excellent customer and supplier relationships that Cargill has established in the U.S. metals market, and we look forward to leveraging the acquired business to further enhance our presence in the U.S.”
The deal is the first between the largest North American metals businesses since 2015, when Reliance Steel & Aluminum Company acquired Tubular Steel Inc.
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