Ryerson and OIympic Steel announce merger

Chicago-based Ryerson Holding Corp. has entered into an agreement to acquire Cleveland-based Olympic Steel Inc., a fellow metals service centers operator.

Ryerson says the acquisition will make it the second largest operator of North American metals service centers. Such service centers are steady generators of metals for recycling. Ryerson has about 4,300 employees operating from approximately 110 locations, predominantly in North America, while Olympic Steel operates more than 50 sites, all in North America.

The companies expect the merger to generate approximately $120 million in annual synergies after two years thanks to procurement scale, efficiency gains, commercial enhancement and network optimization.

Under the terms of the merger agreement, Olympic Steel shareholders will receive shares in Ryerson and will own approximately 37 percent of the combined company.

Ryerson President and CEO Eddie Lehner will serve as CEO of the combined company and Richard T. Marabito, CEO of Olympic Steel, will become president and chief operating officer.

“This merger represents an immensely attractive and unique opportunity for Ryerson and Olympic Steel, as it combines our two organizations, which couldn't be more complementary and synergistic around the products, services, footprint and customer experience that will enhance our market presence while adding significant value to our stakeholders,” Lehner says.

“I could not be more optimistic and energized about the merging of our two companies with a combined 255 years of industrial metals service center experience."

“We are very excited about the combination of Ryerson and Olympic Steel and the trajectory of the business going forward,” Ryerson Chair Steve Larson says.

J.P. Morgan is acting as Ryerson’s financial advisor and New York-based Willkie Farr & Gallagher LLP is acting as its legal counsel on the transaction.

Cleveland-based KeyBanc Capital Markets is acting as Olympic Steel’s financial adviser, along with Los Angeles-based Houlihan Lokey, while Jones Day, also based in Cleveland, is acting as its legal counsel.

“We are thrilled to merge with Ryerson and for all of the opportunities that becoming a $6.5 billion company will provide to our key stakeholders," Marabito says. "Together, we will offer new career growth to our employees, enhanced services to our customers and greater value for our investors."