Nucor Completes Skyline Buyout - Analyst Blog
22 Giugno 2012 - 10:30AM
Zacks
Steel producer, Nucor
Corporation (NUE) has completed the acquisition of Skyline
Steel LLC and its affiliates – a steel-foundation manufacturing and
distribution subsidiary of the steel giant
ArcelorMittal (MT) – for a total sum of
approximately $605 million.
Post-acquisition, Skyline Steel LLC
will be Nucor’s wholly owned subsidiary and will function from the
company’s existing headquarters in Parsippany, New Jersey. However,
it will continue to exclusively distribute ArcelorMittal's piling
and foundation products in North America and the Caribbean. Nucor
expects the acquisition to be accretive in the next fiscal
year.
Skyline Steel has been distributing
Nucor’s piling products for over 20 years and has been a key
customer of H-piling and hot rolled sheet piling from Nucor-Yamato
Steel. Through the acquisition, Nucor aims to integrate Skyline
into its system and make it a more valuable downstream customer of
coiled plate and sheet products. In addition, the company expects
the technological know how of both the companies to help them with
innovative solutions for the construction industry.
Skyline has an impressive
distribution network, well complemented by exceptional customer
service and technical back up. The company has 21 sales offices and
a strong infrastructure comprising of a large number of stocking
sites, robust supply chain and numerous processing and fabrication
facilities.
Skyline’s distribution network
serves the U.S., Canada, Mexico and the Caribbean markets,
providing solutions for application in heavy civil construction,
marine construction, underground commercial parking, storm
protection, bridge and highway construction and environment
containment projects in the infrastructure and construction
industries. Therefore, Nucor made a smart move towards inorganic
growth since Skyline’s excellent network will enable it to expand
in North America.
Nucor Corp. faces stiff competition
from Commercial Metals Co. (CMC) and
United States Steel Corp. (X). The stock currently
holds a short-term Zacks #5 Rank, which translates to short term
Strong Sell rating.
COMMERCIAL METL (CMC): Free Stock Analysis Report
ARCELOR MITTAL (MT): Free Stock Analysis Report
NUCOR CORP (NUE): Free Stock Analysis Report
UTD STATES STL (X): Free Stock Analysis Report
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