The Chicago-based Ryerson Holding Corp., one of the nation's biggest distributors and processors of metals, said Wednesday it has acquired Southern Tool Steel (STS) in Chattanooga to expand its service to manufacturers in the Southeast.
Arnold ErwinSTS, which was started in 1984 by Arnold Erwin and his father, will continue to operate under its own brand at its Hixson facility. The privately-held company has about 90 employees at its facilities in Chattanooga and Gallatin, Tenn., and serves a diversified account base with specialization in bar and plate processing, with grinding capabilities. Its customer base includes machine, tool and die shops, energy providers, 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. "Moreover, like our acquisition of Fay Industries announced in January 2015, we are joined by a company in STS that creates exceptional customer experiences in the southern U.S. 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 about 4,000 employees.
"Joining Ryerson enables Southern Tool Steel to capitalize on our growth opportunities and fulfill our primary objective, which is to solve problems and provide superior service to customers," said Erwin, chief executive officer of STS.
Christopher Bona, communications director for Ryerson, said Southern Tool Steel will maintain its name and Erwin will continue with the company.
"There are no plans for restructuring as part of the announcement," Bona said. "The acquisition is a strategic fit with Ryerson's business, adding to the company's service center network and strengthening its ability to serve key end markets."
Terms of the sale were not disclosed. Chattanooga-based Four Bridges Capital acted as the investment banker for STS in the sale.
Andy Stockett, managing director at Four Bridges, said his firm contacted a number of potential buyers for STS.
"We determined on a variety of fronts that Ryerson was the best fit," he said. "This is really a good indicator that corporate acquirers have cash on the balance sheet to buy in the current market. I also think it speaks well for this area that a company out of Chicago that already has a site in Chattanooga wants to expand its presence here to serve what they see as a growing manufacturing market in the tri-state region."
Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340.