Steel Products
Russel Metals Sells TriMark Shares
Written by Becca Moczygemba
August 1, 2023
Canadian metals distributor Russel Metals announced it is selling off 50% of its equity in TriMark Tubulars Ltd. to Japan’s Marubeni-Itochu Tubulars Ltd. (MITI).
The value of the sale is approximately CAD$61 million (US$46 million) and should be finalized in Q3, the company in a press release on July 31.
The two companies merged their respective oil country tubular goods (OCTG) and line pipe businesses in 2021 to create TriMark Tubulars. Under TriMark, Russel was able to convert C$109 million into cash and retain a C$32-million equity interest in the company.
In Q1 of 2023, Russel recorded sequential growth in each of its business categories. Although, year-over-year results were not as strong.
Combined with the dividends from TriMark, the sale of Russel’s interest will give the company a return on investment of over 200%, the company said.
“This transaction represents the final step to our staged exit from the OCTG/line pipe business. Over the past three years, we have repatriated approximately (C)$375 million of capital from the OCTG/line pipe business and have reinvested in our core segments at superior returns with lower risk,” John Reid, president and CEO of Russel Metals, said in the release.
“Additionally, we have retained significant financial flexibility to opportunistically grow our company and return capital to our shareholders,” he added.
Becca Moczygemba
Read more from Becca MoczygembaLatest in Steel Products
September energy market update
In this Premium analysis we examine North American oil and natural gas prices, drill rig activity, and crude oil stock levels through September. Trends in energy prices and rig counts serve as leading indicators for oil country tubular goods (OCTG) and line pipe demand.
Market says cutting interest rates will spur stalled domestic plate demand
Market sources say demand for domestic plate refuses to budge despite stagnating prices.
U.S. Steel to halt slab conversion at Granite City Works
U.S. Steel said it plans to reduce slab consumption at its Granite City Works near St. Louis, a company spokesperson said on Monday. The Pittsburgh-based steelmaker will shift the production and processing of steel slabs to its Mon Valley Works near Pittsburgh and its Gary Works near Chicago. Citing a United Steelworkers (USW) union memo, […]
SMU Week in Review: September 1-5
Here are highlights of what’s happened this past week and a few upcoming things to keep an eye on.
HR Futures: Market finds footing on supply-side mechanics
As Labor Day marks the transition into fall, the steel market enters September with a similar sense of change. Supply-side fundamentals are beginning to show signs of restraint: imports are limited, outages loom, and production is capped, setting the stage for a market that feels steady on the surface but still unsettled underneath.