Severstal Sells Four Northern Steel Group Companies
Severstal North America, Dearborn, Mich., has agreed to sell part of its Northern Steel Group of service center companies to Aurora Resurgence, a Los Angeles-based equity fund.
The agreement is for the sale of Miami Valley Steel Service, Piqua, Ohio; Premier Resource Group, Lombard, Ill.; Electric Coating Technology, East Chicago, Ind., and U.S. Metals and Supply, St. Louis, Mo.
The remaining businesses under Northern Steel Group will be retained by Severstal North America. They include Independent Steel, Valley City, Ohio, and Sun Steel and Century Steel, both of Chicago Heights, Ill.
“The sale of these Northern Steel Group businesses will allow us to more fully focus on our core strategy of building competitive and efficient steelmaking assets in the United States,” says Sergei Kuznetsov, CEO of Severstal North America.
Net proceeds from the sale will be used by Severstal North America for general corporate purposes. The transaction is expected to be completed during the second quarter pending the expiration or early termination of the waiting period and other customary closing conditions.
Northern Steel Group became a part of Severstal when the steelmaker acquired Esmark Corp., which included Wheeling Pitt Steel Co. Esmark’s founders, Craig and James Bouchard, had expressed interest in reacquiring the Northern Steel Group companies as they attempt to rebuild their service center holdings.
Northern Steel Group was 25th on the Metal Center News Top 50 service center ranking of 2009. It reported revenue of $711 million in 2008.