Friedman Buys PlatePlus Operations in East Chicago, Granite City

The purchase price was $63.8 million in cash and 516,041 shares of Friedman’s common stock. Roughly $18 million of that amount was for fixed assets. The balance was for steel inventory. The purchase price is subject to final inventory and assumed liability adjustments, Longview, Texas-based Friedman said.

“Over the last several years, we have strategically invested in enhanced processing capabilities to meet virtually all customer needs, including our new stretcher leveler at our Decatur, Ala., facility and our new facility in Sinton, Texas, that is expected to open later this year,” Friedman president and CEO Mike Taylor said in a statement. “We are transforming our company with leading technologies and a broader geographic reach that will allow us to serve more customers with a larger portfolio of leading products.”

The acquired facilities provide temper passed cut-to-length sheet ranging from 16 gauge to 5/8-inches thick and in widths from 36 to 72 inches. They will operate as part of Friedman’s coil product segment and are expected to more than double its annual volume.

Friedman’s coil segment annual sales volume was 152,000 tons for the period ended March 31, 2022. Sales for the acquired facilities were 163,000 tons for the same twelve-month period.

The acquisitions enable Friedman to shorten lead times. They will also give the company a significant presence in the South and Midwest – both major US steel-consuming markets, the company said.

East Chicago located just across the Indiana border from Chicago. And Granite City is in southern Illinois, just across the Mississippi River from St. Louis.

“I have worked closely with these assets and the talented teams at the East Chicago and Granite City facilities and welcome these employees to Friedman,” Taylor said. “We also look forward to working alongside Plateplus’ current owner, Metal One Corporation, which will become a valued and important shareholder of Friedman and (which) brings domestic and global metals supply chain expertise.”

Friedman is a manufacturer and processor of steel products with operations in Hickman, Ark., Decatur, Lone Star, Texas – and now in East Chicago and Granite City as well. It is also building a new coil location in Sinton, with operations there expected to commence in August 2022.

PlatePlus has also sold locations in Tulsa, Okla., and Windsor, Colo., to NIM Group, the parent of Norfolk Iron & Metal, Metalwest, and Cd’A Metals.

By David Schollaert, David@SteelMarketUpdate.com