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Chicago-based Ryerson Holding Corp., one of the nation’s largest metal distributors and processors, said on Wednesday it had acquired Southern Tool Steel (STS) in Chattanooga to expand its services to manufacturers in the Southeast.
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STS, which was started in 1984 by Arnold Erwin and his father, will continue to operate under its own brand at its factory in Hixson. The privately held company has approximately 90 employees at its facilities in Chattanooga and Gallatin, Tenn., And serves a diverse account base with a specialization in bar and plate processing, with grinding capabilities. Its customer base includes machine, tool and die shops, energy suppliers, automotive manufacturers, appliance manufacturers and aerospace parts manufacturers.
“STS brings extensive bar and plate processing capabilities to Ryerson, consistent with our focus on long products and value-added services,†Ryerson CEO Eddie Lehner said in a statement. “In addition, like our acquisition of Fay Industries announced in January 2015, we are joined by an STS company that is creating exceptional customer experiences in the southern US market.
Ryerson operates a Chattanooga facility on Polymer Drive in Chattanooga, one of more than 100 locations operated by Ryerson in the United States, Mexico, Canada, China and Brazil. Founded in 1842, Ryerson has approximately 4,000 employees.
“Joining Ryerson allows Southern Tool Steel to capitalize on our growth opportunities and achieve our primary goal of solving problems and providing superior service to customers,†said Erwin, president and CEO of STS.
Christopher Bona, director of communications for Ryerson, said Southern Tool Steel will retain his name and Erwin will continue with the company.
“There is no restructuring plan as part of the announcement,†Bona said. “The acquisition is a strategic fit with Ryerson’s business, adding to the company’s network of service centers and strengthening its ability to serve key end markets.”
Terms of the sale were not disclosed. Four Bridges Capital, based in Chattanooga, acted as investment banker for STS in the sale.
Andy Stockett, chief executive of Four Bridges, said his company has contacted a number of potential buyers for STS.
“We have determined on a number of fronts that Ryerson is the best candidate,†he said. “This is really a good indicator that business buyers have on-balance sheet cash to buy in the current market. I also think it speaks well for this area that a Chicago company that already has a site in Chattanooga wants. expand its presence here to serve what they see as a growing manufacturing market in the Tri-State region. â€
Contact Dave Flessner at [email protected] or 757-6340.
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