Nucor has agreed to acquire hollow structural sections producer Independence Tube for $435 million.
Independence has four locations in Illinois and Alabama with annual production of approximately 600,000 st. It purchases hot-rolled coil for its HSS tube production, which Nucor produces, and its plants are in close proximity to Nucor's sheet mills in Decatur, Alabama; Crawfordsville, Indiana, and Ghent, Kentucky.
Independence has the second-largest US market share in HSS and sells it primarily through service centers, according to Nucor.
"Independence Tube is a natural fit with Nucor," said Nucor CEO John Ferriola. "Their business model is similar to ours with extremely efficient manufacturing facilities and a highly variable cost structure. Our companies' cultures are also similar, sharing a belief in continual improvement, operating efficiency and the value of our employees."
Ferriola added, "This acquisition is another important step in our long-term strategy to increase the number of value-added products we can offer our customers. It also adds to our portfolio another growth platform."
The acquisition will complement Nucor?s installation of a large diameter tube mill in Iuka, Mississippi at wholly-owned subsidiary Skyline Steel. "Adding large size HSS to [Independence's] already comprehensive product line will create the widest product offering in North America for HSS solutions," Nucor stated.
Independence is primarily a producer of HSS and does not focus on products for energy or other pipe and tube segments. HSS is used in a broad array of structural and mechanical tube applications, including nonresidential construction, infrastructure and agricultural and construction equipment end-use markets.
