Business
Russel Metals and Marubeni-Itochu To Merge Their Canadian OCTG/Line Pipe Businesses
Russel Metals and Marubeni-Itochu To Merge Their Canadian OCTG/Line Pipe Businesses ...
About this update from Russel Metals Inc.
[{"type":"text","content":"\n \n \n \n Russel Metals and Marubeni-Itochu To Merge Their Canadian OCTG/Line Pipe Businesses\n \n \n /* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n \n \n \n \n \n \n Canada NewsWire\n \n \n \n \n \n \n Complementary Businesses to Create Greater Scale and Broaden Product Mix\n \n \n \n \n Russel Metals to Realize\n \n $138 Million\n \n of Cash Proceeds and Retain a 50% Equity Interest\n \n \n \n \n \n TORONTO\n \n ,\n \n April 14, 2021\n \n /CNW/ - Russel Metals Inc. (TSX: RUS) announces that it has entered into an agreement with Marubeni-Itochu Tubulars America Inc. (\"MITI\"), whereby Russel Metals and MITI will combine their respective Canadian OCTG/line pipe businesses. In conjunction with the combination, Russel Metals will receive a substantial portion of its contributed net asset value in cash proceeds, in addition to retaining a 50% equity interest in the combined venture.\n \n \n Currently, Russel Metals operates its Canadian OCTG/line pipe business through its wholly owned subsidiary Triumph Tubular & Supply Ltd. (\"Triumph\"), and MITI operates its Canadian OCTG/line pipe business through its wholly owned subsidiary Hallmark Tubulars Ltd. (\"Hallmark\"). The combined business of Triumph and Hallmark will operate under a newly incorporated company, named TriMark Tubulars Ltd. (\"TriMark\").\n \n \n Over the past several years, the macro business conditions for the OCTG/line pipe industry have changed substantially as a result of a challenging energy market as well as the disintermediation of distributors by certain direct-to-market manufacturers. As a result, this combination will create a business that has the necessary economies of scale, including a diverse product offering and business platform to efficiently and effectively serve its customers.\n \n \n \n John Reid\n \n , President and CEO of Russel Metals commented, \"Over the past nine months, we have been strategically focused on both rationalizing the operations and reducing the capital deployed in our OCTG/line pipe businesses. This transaction provides an opportunity to substantially repatriate capital...