Ryerson to Shutter Operations in Chicago
Ryerson will close its processing and distribution operations in its hometown of Chicago by the end of 2008. The company’s corporate headquarters will remain in the city.

The phased moves will be undertaken to bring Ryerson’s inventories closer to end-use customers, the company says.

“We are taking these steps to enhance our long-term viability and be a stronger corporate citizen in Chicago,” says Steve Makarewicz, president and chief operating officer of Ryerson. “We are confident that these moves will improve our customer service levels and make us a more nimble competitor.”

The phaseout of processing and distributing operations will cut approximately 600 jobs from the Ryerson payroll, with two facilities closed. Most of the material serving the Chicago market will be stocked at the company’s facility in Burns Harbor, Ind. Depot material used by customers in other markets will be moved to service centers in those local markets.

The announcement is part of Ryerson’s move to a “decentralized model,” says Patti Buckland, Ryerson’s vice president of marketing. The company has five regions, each with the leadership, autonomy and resources to focus on their specific markets, she says.

The facility closings represent the second major announcement since Ryerson was acquired by Platinum Equity and taken private last quarter. In the first, Robert Archambault, a partner at Platinum Equity, was named interim CEO, replacing former Chairman and CEO Neil Novich.

Buffett’s Company to Acquire
60 Percent of Marmon Holdings
“Business will continue as usual,” says Marmon/Keystone President Norm Gottschalk, following the acquisition of a majority stake in Marmon Holdings by Berkshire Hathaway and its high-profile chairman Warren Buffett.

Berkshire Hathaway has agreed to purchase 60 percent of Chicago-based Marmon Holdings from the Pritzker family for $4.5 billion. The Marmon Group is an international association of businesses, including Butler, Pa.-based pipe and tube distributor Marmon/Keystone Corp.

Marmon/Keystone ranked 16th in the 2007 Metal Center News Service Center Top 50, with more than $899 million in 2006 revenue.

“The Marmon Group companies, including Marmon/Keystone, will continue to operate as they have, with the same management,” says David Dees, director of communications for the Marmon Group. 

Company officials expect to close the transaction in the first quarter. Over the next five to six years, Berkshire plans to acquire the remaining 40 percent of Marmon, depending on its future earnings.

The Marmon Group was acquired by brothers Jay and Robert Pritzker in 1953, when it was an ailing manufacturing operation in Ohio. Today, it includes 125 businesses in many manufacturing and service sectors. Since 2002, Jay’s son Tom Pritzker has served as chairman, while John Nichols and now Frank Ptak served as CEOs.

“After meeting with Messrs. Ptak and Nichols, they were just what I expected from Marmon’s impressive record of growth and profitability over the years, and the decision to purchase and work out the details of this transaction was done without delay,” says Buffett.

Between 2002 and 2007 Marmon’s operating income more than tripled. During that same period operating margins increased from 4.9 percent to 12.4 percent.

PNA Group Purchases Precision Flamecutting
PNA Group, Atlanta, has acquired Precision Flamecutting & Steel L.P., a limited partnership based in Houston. Precision Flamecutting processes and distributes carbon, alloy and HSLA steel plate, with plasma-cutting, flame-cutting and beveling services. It also offers machining, rolling, forming, heat-treating, coating and general machining and fabrication services.

“We are very excited about the acquisition of Precision, and this very well-run company will complement our existing operations in the Houston market,” says Maurice “Sandy” Nelson, president and CEO of PNAG.

Additionally, Houston-based Metals Supply Co., a subsidiary of PNA Group, has announced plans for a new facility in the Dallas area. The company will build an 80,000-square-foot facility on a 21-acre site in Cedar Hill, Texas. Besides the space under roof, an additional 75,000 square-feet will be available under outside crane.

Construction is expected to begin in the third quarter this year.

A.M. Castle Acquires Metals UK Group
A.M. Castle & Co., Franklin Park, Ill., has acquired the capital stock of Metals UK Group, a distributor and processor of specialty metals serving the oil and gas, aerospace, petrochemical and power generation markets. The company has three facilities in the UK and a fourth in Bilbao, Spain.

The company reported revenues of $72 million in fiscal year 2007. Sales outside the UK comprise approximately 25 percent of revenues, and include customers in Europe, Asia, Australia and the Americas.

The current management team, including founder and President Ian Griffiths, will remain in place.  

“Metals UK Group is complementary to our existing North American operations and provides an opportunity for Castle to expand its global reach,” says Michael Goldberg, president and CEO of A.M. Castle. “The company’s specialty metals product offering, processing capabilities and supply chain expertise serve potential high growth industries where we seek to expand our presence.” 

Heidtman Expanding in Butler Corridor
Heidtman Steel Products Inc., Toledo, Ohio, is constructing an additional 120,000-square-foot building at its manufacturing operation in the Butler Industrial Corridor in Northeastern Indiana. The facility will house a light-gauge multi-blanking line.

Heidtman will invest $13.5 million in the facility, which will include a slitting line as part of a second phase of the project. 

“The demand for our steel products continues to grow,” says Scott Carter, general manager of operations for Heidtman Steel. “This expansion allows us to upgrade our technology and meet the needs of the market.”

Heidtman Steel currently has 510,000 square feet of production space in the Butler Industrial Corridor, adjacent to Steel Dynamics Inc.

Lapham-Hickey Acquires
Alabama’s Hubbell Steel
Lapham-Hickey Steel Corp., Chicago, has made its first foray into the southeastern U.S. with the purchase of the Hubbell Steel division of Gibraltar Industries in Fairfield, Ala.

The 100,000-square-foot facility handles coated and pre-painted materials. Equipment includes a 60-inch slitter.

“It gives us an opportunity to get into the South, which is something we’ve been trying to do for a while,” says Bill Hickey, president of Lapham-Hickey Steel. “We liked the location and we liked the people.’

Worthington Sales, Income Dip in Second Quarter
Worthington Industries Inc., Columbus, Ohio, reported second-quarter net sales of $713.7 million, a 2 percent decrease from the same period in 2006. Net income dropped 45.2 percent from $27.0 million to $14.7 million during the quarter ending Nov. 30.

“Second quarter and first half performance reflects market weakness particularly in our two primary end markets, automotive and construction; the resulting cost/price squeeze across our businesses; and the significant challenge in metal framing,” Chairman and CEO John McConnell told investors and analysts. “The second quarter likely reflects the low point in metal framing results.” 

In the company’s steel processing segment, quarterly net sales fell 8 percent, to $344.2 million from $374.8 million, in the comparable quarter of fiscal 2007. Volumes rose 6 percent as a significant increase in tolling business more than offset a decline in direct business. Tolling volumes in the prior-year period were negatively impacted while capacity was increased in the operations of the Spartan Steel Coating consolidated joint venture.

The resulting change in product mix contributed to the decrease in net sales and the lower average selling price, down 14 percent, for the most recent quarter. Operating income decreased because of a narrower spread between average selling prices and material costs, especially at Precision Specialty Metals, a stainless steel processing facility, company officials reported.

Reliance Subsidiary Valex Corp. Opens China Facility
Valex Corp., a Reliance Steel & Aluminum Co. subsidiary, has opened a facility in China. Valex China Co. Ltd., a 24,000-square-foot facility, is located in the Nanhui district of Shanghai and will produce ultra-high-purity tubes, fittings and valves for the semiconductor, LCD and solar industries.

The new venture will be the first Valex manufacturing plant based in China and will position the company to improve its share of the growing Asian market. Valex Corp. also has operations in Ventura, Calif., and Pyongtaek, South Korea, and is a 97 percent owned subsidiary of Reliance.

“We are very excited about the opening of Valex China. This new facility will allow us to expand our market share in this fast-growing market by offering localized production and enhanced services to our customers, and also increases our existing global presence,” says David H. Hannah, chairman and CEO of Los Angeles-based Reliance.

Leeco Building Plate Facility in N.C.
Leeco Steel LLC, Darien, Ill., will build a plate distribution and processing center in Hertford County, N.C. The facility, expected to open in late 2008, will serve many plate-consuming industries throughout the Southeast and East Coast. 

“The Hertford County plant will provide geographic proximity to our customers and processing that is not currently available in our other facilities,” says Bob Pepoff, Leeco Steel CEO and president. “This expansion positions Leeco to become a major competitor not only in the southeastern U.S., but everywhere east of the Mississippi River.”

The Leeco Hertford County facility will emphasize plate distribution and processing services to industries such as bridge, barge, ship and wind tower. It will be designed to allow customers to take advantage of truck, rail and barge shipping. It will be the O’Neal Steel subsidiary’s fifth plate distribution facility in North America.

Steel Technologies Integrating Mi-Tech
Joint venture operation Mi-Tech Steel will be integrated into one of its 50-50 partners, Steel Technologies, Louisville, Ky. Mi-Tech Steel Inc. is a joint venture between Steel Technologies and Mitsui & Co., which acquired Steel Technologies in 2007.

Mi-Tech Steel, established in 1987, had estimated revenues of $350 million in 2007. It operates five steel processing facilities in North America, with a sixth in Woodstock, Ontario, expected to open early this year.

“We are very pleased to bring our Mi-Tech Steel partnership company under the name of Steel Technologies, which will create a much stronger and more dynamic company in the future,” says Bradford Ray, CEO of Steel Technologies. “This combination will help streamline our approach to the array of markets we serve and places us in a strong competitive position to offer enhanced logistics and a broader product range to our customers. Our strategy is to be a consolidator in the steel processing sector, and we plan to continue in this direction.”

Ferguson Metals, AIM Merge Operations
Ferguson Metals, Hamilton, Ohio, will consolidate operations with Miamiville, Ohio-based AIM International this month. The merger of the two O’Neal Steel facilities will do business as United Performance Metals.

“The strong synergies that exist between the two organizations coupled with the market potential created by going to market as a single, united entity made the decision to merge an easy one,” says Ferguson Metals’ President Wayne Ferguson.

The new United Performance Metals will deliver its customers a greater variety of flat-rolled, specialty metal products with a focus on specialty grades of stainless, nickel alloy and cobalt alloys. United’s 108,000-square-foot facility is equipped to process coil, sheet and plate product with comprehensive slitting, edging, shearing, leveling and sawing capabilities.

“I am excited about the opportunity to leverage the collective strengths of both organizations as we seek to significantly grow our presence in the market,” says AIM International President Tom Kennard.

Rolled Alloys Opens Facility in Illinois
Rolled Alloys, Temperance, Mich., has opened its new stainless bar sales and processing facility in Streamwood, Ill. The 33,000-square-foot facility will inventory the company’s machining quality round bar in grades 303, 304/L and 316L, among others.

The facility will also have three Kasto bar saws that can cut up to 10-inch diameter bar. Mike Rinker will serve as general manager of the facility, which will serve customers in Illinois, Wisconsin, Iowa, Indiana and Minnesota.

Briefs
Eagle Steel Products, Jeffersonville, Ind., has renewed a transportation contract with Ryder System Inc. to provide dedicated contract carriage services. Ryder will provide drivers for its vehicles, fleet management and maintenance services.

Australia’s largest privately owned service center chain, the Southern Steel Group, has installed a high-speed slitting line designed and built by Red Bud Industries, Red Bud, Ill.  The 4 millimeter by 1,524 millimeter slitting line was installed at the company’s Steel Park facility in Melbourne, by subsidiary company Surdex Steel.

Sandmeyer Steel Co. has added LDX 2101 to its line of corrosion-resistant stainless steel and nickel alloy plate products. LDX 2101 is a low-nickel, nitrogen-enhanced lean duplex stainless steel with corrosion resistance similar to 304 but with higher mechanical strength.

Corus Service Centers, the largest full-line service center group in Europe, has selected STRATIX enterprise software from Invera to expand to more than 60 service centers in the United Kingdom and Europe. The project covers more than 3,000 users in a multi-lingual, multi-currency environment.

Reliance Steel & Aluminum Co., Los Angeles, has sold the assets and business of the Encore Coils division of Encore Group Ltd., a subsidiary of Reliance, to Samuel, Son & Co., Ltd., Mississauga, Ontario. Terms were not disclosed. Reliance acquired the Encore Group of service center companies--Encore Metals, Encore Metals (USA) Inc., Encore Coils and Team Tube in Canada—in February 2007. The Encore Metals and Team Tube divisions of the Encore Group, which Reliance will retain, specialize in the processing and distribution of alloy and carbon bar and tube, as well as stainless steel sheet, plate and bar products through 12 locations. The Encore Coils division processes and distributes carbon steel flat-rolled products through its five facilities located in Western Canada. For the year ended Dec. 31, 2007, Encore Coils’ net sales totaled approximately $50 million. "The most important part of the Encore Group to us is its specialty metals business, which we will retain,” says Reliance Chairman and Chief Executive Officer David H. Hannah. “The Encore Coils business did not fit well for us because we do not have any similar facilities nearby that could help support this relatively small business. The sale of the Encore Coils business to Samuel allows us to exit this market without disrupting the Encore Coils customer base."

Reliable Tube Inc., a service center supplying carbon steel tubing to the structural and manufacturing industries in Canada’s British Columbia, plans to implement Verticent ERP software to manage the company’s western Canada distribution center.

People
Keith Medick has been appointed president and chief operating officer of Metal Processing Co., Gary, Ind. Medick spent 22 years with Ryerson, serving as vice president responsible for integrating the company’s acquisition of Integris Metals. In addition to overall management of the business, his primary responsibilities will include enhancing and promoting MPC’s core processing capabilities including the company’s new 72-inch cut-to-length line.  

Luis E. Benitez retired from Future Metals Inc., Tamarac, Fla., on Jan. 1. He spent 32 years at Future Metals, including the last seven as president. Mark G. Borland, who had been executive vice president for the Marmon/Keystone affiliate, succeeds him. Additionally, Leslie Mason has been named to regional sales, replacing the retiring Joe D’Ottavio. 

Christopher J. Moreton, chief financial officer, will retire from PNA Group, Atlanta, at the end of January. William S. Johnson, senior vice president of finance, will replace him as CFO.

Joe H. Loudenback has joined ABC Metals Inc., Logansport, Ind., as North American sales manager. He will be responsible for coordinating sales and marketing efforts throughout North America for the distributor of nonferrous alloys.