TMS International Corp., Glassport, Pa., and The Pritzker Organization LLC (TPO), Chicago, have announced a deal under which business interests of certain members of the Pritzker family will acquire TMS in an all-cash transaction valued at $1 billion, including refinanced third-party debt. TPO is the merchant bank representing the interests of certain members of the Pritzker family.
TMS, through its subsidiaries, including Tube City IMS Corp., is the largest provider of outsourced industrial services to steel mills in North America as measured by revenue. The company provides mill services at 81 customer sites in 12 countries and operates 36 brokerage offices from which it buys and sells raw materials across five continents.
Raymond Kalouche, president and CEO of TMS, says, “We have built a world-class, outsourced industrial services company over the past six years during our partnership with Onex. With this transaction, we are pleased to be able to maximize stockholder returns while positioning ourselves to continue to deliver exceptional value for our customers and expand our global operations as a privately held company, with TPO as our new long-term partner.”
Tom Pritzker, chairman and CEO of TPO, says, “TMS is a leading provider of mill, procurement and logistics services to the steel industry, with an exceptional management team and a proven track record of delivering value to its customers. We are delighted to have the opportunity for TPO to participate in and support the growth of the business over the long term."
He adds, "Throughout TPO’s history, we have partnered with strong management teams to build durable businesses for the future. We look forward to working closely with the TMS management team in a similar fashion to help them build on their impressive track record of success.”
The transaction is expected to close in the fourth quarter of 2013. Completion of the transaction is subject to certain closing conditions, including, among other things, expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
Upon completion of the transaction, TMS will become a privately held company and its common stock will no longer trade on the New York Stock Exchange. TMS’ board of directors has unanimously approved and declared advisable the definitive merger agreement and the transactions contemplated thereby. Following the execution of the definitive merger agreement, Onex Corporation and certain of its affiliates, the holders of about 60 percent of the outstanding shares of TMS common stock, executed a written consent adopting and approving the definitive merger agreement.