Esmark Buys Excalibur Assets
After being bought by OAO Severstal in 2008 the industrial group has gone on a dealmaking spree and could be buying even more.
December 30, 2009
Esmark Industrial Group bought Excalibur Machine Company assets in Meadville, Pennsylvania for $3.5 million in cash.
Esmark co-chief executive David Luptak will become president and chief executive of the newly-formed Esmark Industrial Group, which will include Excalibur’s assets.
The deal is the second in as many months for Esmark, which in November bought Illinois-based Amtex Steel Inc. for $10 million. It then re-named that asset Chicago Steel & Iron and integrated it into Esmark Steel Group as a subsidiary, separate from the industrial group.
Esmark Steel Group chief executive Thomas Modrowski said that deal is part of its plans to expand via service center acquisitions in the Midwest. He added that by the end of 2010, the company will continue to seek out more buys on a cash-only basis; Esmark carries no debt.
In 2008, Esmark Inc., then, listed on Nasdaq, agreed to sell to OAO Severstal, the Russian mining company. The deal, including debt, was valued at about $1.25 billion, or $19.25 per share. The June deal was sealed when OAO Severstal outbid Essar Steel Holdings Limited and successfully secured the approval of the United Steelworkers Union at a time when the competing bidder had difficulty finding support for its buy.
Calls seeking comment were not returned by press time.
There have been some, but not many, investments in the steel space in 2009. Special purpose acquisition company China Opportunity Acquisition Co. went abroad to buy Golden Green Enterprises Ltd, a Chinese steel company, in a deal that performed well post-merger.
Also, Black Diamond Capital Management, a private equity firm, had sought to buy PTC Alliance, a maker of steel products, for months via a DIP investment.
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