Service Centers

Russel Metals to buy seven of Samuel’s operations

December 4, 2023

Canadian metals distributor Russel Metals Inc. plans to acquire Samuel, Son & Co.’s service center operations in Western Canada and the US for roughly CA$225 million (US$165.5 million).

In total, Russel will acquire seven Samuel operations that generated revenues of CA$457 million for the nine months ended Sept. 30, 2023, according to a Russel press release on Monday, Dec. 4. The buy includes operations in Winnipeg, Manitoba; Calgary and Nisku, Alberta; and Langley and Surrey, British Columbia, in Canada; and facilities in Buffalo, N.Y., and Pittsburgh in the US.

“Our respective businesses are very complementary from both geographic and product mix perspectives,” said John Reid, Russel Metals’ president and CEO. “We look forward to having the approximately 340 Samuel employees join the Russel family.”

Russel said the purchase price is based on the working capital’s CA$186-million net book value and an additional CA$39 million related to equipment, machinery, and other sundry items.

The transaction is expected to close in Q1’24 or Q2’24 and will be financed from cash on hand – which totaled CA$569 million on Sept. 30, 2023, Russel said. It will be subject to Canadian regulatory clearance and customary closing conditions.

Samuel will retain its location in Delta, British Columbia, but will conduct an orderly shutdown of the facility.

“We are proud of the strength of the operations we are selling to Russel, which we believe can be made even stronger as part of this newly combined business,” said Samuel president and CEO Colin Osborne in a press release. “On behalf of Samuel, I would like to extend our appreciation to the team members who will be joining Russel for playing such an important role in our service center business.”

The acquisition strengthens Russel’s Western Canada presence with non-ferrous product lines and bolsters its existing operations in the US Midwest, the release said.

Toronto-based Russel is one of the largest service center groups in North America, with 46 Canadian locations and 17 US locations. It was ranked No. 5 in the Metal Center News Service Center Top 50 in 2023 with annual revenues last year of around CA$3.9 billion.

Correction: The original article posted on Monday, Dec. 4, incorrectly listed Russel Metals’ acquisitions as only carbon plate operations. The correct acquisitions include non-ferrous and carbon plate facilities. The updated article on Thursday, Dec. 7, reflects this.

David Schollaert

David Schollaert is a senior analyst for Steel Market Update. David joined SMU after more than a decade in the metals and mining industry in a myriad of different roles. Much of his early experience and expertise were within the coverage and analysis of steel-making raw materials and served previously as senior editor of the CRU Prices Service. Most recently, however, before his return to market analysis, David held roles as a metals buyer and an operations manager for raw material suppliers. Based in CRU’s Pittsburgh office, David can be reached at david@steelmarketupdate.com or 724-720-1008.