RG Steel Completes Purchase Of Three Steel Companies
Sparrows Point, Warren And Wheeling Facilities Acquired From Severstal
Sparrows Point, MD - RG Steel, LLC, an affiliate of The Renco Group, Inc., has completed the stock purchase of three U.S. assets from Severstal US Holdings, LLC. As a result of the completion of this purchase, RG Steel has 7.5 million tons of annualized capacity, making it the fourth-largest flat-rolled steel company in the United States.
RG Steel now comprises integrated steel plants at Sparrows Point, Md.; Warren, Ohio, and Wheeling, W. Va., including finishing facilities in Yorkville and Martins Ferry, Ohio, and the Wheeling Corrugating Company in Wheeling, W.Va. In addition, RG Steel now owns 50 percent of both Mountain State Carbon LLC, a cokemaking facility in Follansbee, W.Va., and Ohio Coatings Company in Yorkville, Ohio.
John Goodwin, President and Chief Executive Officer of RG Steel, said, "Our plan for RG Steel is to become the leader in the manufacture and supply of flat-rolled steel and to provide exceptional customer service. We have the facilities, we have the capital, we have the talent and we have the will to succeed. Our plants and our products are well known in our markets, and we will capitalize on our strengths to become the leading producer of flat-rolled steel in the United States."
He added that "preparations are under way to restart the primary operations through the hot strip mill at our Sparrows Point, Md., plant. Employees are being recalled to that facility as we plan for a safe and orderly resumption of operations. We anticipate that the blast furnace at Sparrows Point will become operational in May."
As part of the transaction, Wells Fargo Capital Finance, part of Wells Fargo & Company, and GE Capital, Corporate Finance, structured a new four-year $750-million syndicated credit facility. The facility, which was oversubscribed, has 12 international banks and financial institutions in the syndicate with Wells Fargo, GE Capital Markets, Inc., Bank of America Merrill Lynch and UBS Investment Bank acting as Joint Lead Arrangers and Joint Book Runners.
For this transaction, Cadwalader Wickersham & Taft were retained for legal counsel while UBS and Metal Strategies were retained as financial advisors.
About RG Steel
RG Steel, LLC is the nation's fourth largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. Its steelmaking facilities are located in Sparrows Point, Md.; Warren, Ohio, and Wheeling, W. Va., and additional finishing facilities are in Yorkville and Martins Ferry, Ohio. In addition, RG Steel owns Wheeling Corrugating Company and has a 50-percent interest in Mountain State Carbon and Ohio Coatings Company. Additional information is available on RG Steel's website at www.rg-steel.com.