Olympic Steel Inc. (Nasdaq: ZEUS), a leading national metals service center, today announced that it has acquired the assets of McCullough Industries, Inc. The all-cash purchase closed on Jan. 2, 2019 and is immediately accretive. Terms were not disclosed. This represents Olympic Steel’s second strategic acquisition in the past nine months.
McCullough Industries, located in Kenton, Ohio, manufactures and sells branded self-dumping hoppers used in a variety of industrial applications. McCullough’s products are primarily sold through industrial distributors and catalogues.
“The McCullough acquisition marks our entry into manufacturing and marketing metal-intensive branded products, which is a key element to our long-term growth strategy,” said Richard T. Marabito, Olympic Steel Chief Executive Officer. “Vertical integration into manufacturing metal products allows us to utilize our existing assets and expertise to more consistently capture higher profit from the point of raw material purchase through the ultimate sale to the end customer.”
McCullough and Wright branded containers are recognized nationally for their durability and performance. Constructed from carbon and stainless steel, the hoppers are produced in a variety of configurations. Easily transported, they are used for storing, handling, recycling and transporting materials used in construction, food service, and landscaping applications. The self-dumping hoppers can also be fitted with feeding devices and integrated into manufacturing processes and assembly lines for scrap and liquid waste collection.
“We are pleased that Stephen McCullough has entrusted Olympic Steel to build on the success and values of the Company founded in 1965 by his father Wright McCullough,” Marabito said. “We look forward to synergistically adding purchasing, metal processing and logistical advantages provided by our service center platform to enhance the already strong financial performance of the business.”
The products will continue to be manufactured in Kenton, Ohio by the existing workforce. In conjunction with the acquisition, Olympic Steel veteran Joseph Casey has been named General Manager – McCullough Industries. Casey began his career with Olympic Steel in 2012 at the Integrity Stainless Division, and has progressed through several positions with increasing responsibility including Inventory Control Supervisor, Service/Scheduling Manager and Plant/Production Manager. Casey is a certified Lean Six Sigma Black Belt, and in 2017, he was promoted to his most recent position of Purchasing Manager.
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as “may,” “will,” “anticipate,” “should,” “intend,” “expect,” “believe,” “estimate,” “project,” “plan,” “potential,” and “continue,” as well as the negative of these terms or similar expressions. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those implied by such statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Such risks and uncertainties include, but are not limited to: our ability to successfully integrate McCullough Industries into our business and risks inherent with the McCullough Industries acquisition in the achievement of expected results, including whether the acquisition will be accretive and within the expected timeframe. We undertake no obligation to publicly release any revisions to any forward-looking statements or to otherwise update any forward-looking statements whether as a result of new information or to reflect events, circumstances or any other unanticipated developments arising after the date on which such statements are made. A further list and description of risks, uncertainties and other factors can be found in our Annual Report on Form 10-K for the year ended December 31, 2017 and in our reports on Forms 10-Q and 8-K.
About Olympic Steel
Founded in 1954, Olympic Steel is a leading U.S. metals service center focused on the direct sale of processed carbon, coated and stainless flat-rolled sheet, coil and plate steel, aluminum, tin plate, and metal-intensive branded products. The Company’s CTI subsidiary is a leading distributor of steel tubing, bar, pipe, valves and fittings, and fabricates pressure parts for the electric utility industry. Headquartered in Cleveland, Ohio, Olympic Steel operates from 32 facilities in North America.
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