Toronto, Ontario-based metals distributor Russel Metals Inc. announced Wednesday that it has entered into a Letter of Intent with Apex Distribution Inc. pursuant to which Apex Distribution has agreed to deal exclusively with Russel Metals until October 31, 2012 and the parties have agreed to negotiate in good faith to enter into a definitive agreement for the acquisition by Russel Metals of Apex Distribution and related companies.
Apex Distribution is a leading Canadian oilfield supply company servicing the energy segment in Western Canada. Apex Distribution's annual revenues for fiscal 2012 were approximately $500 million and its earnings before interest and taxes were approximately $42 million. Apex Distribution operates 58 branches, 44 in Canada and 14 in the US.
Brian Hedges, President and CEO of Russel Metals stated "The addition of Apex Distribution would complement our existing energy tubular products segment and would provide a new channel of distribution into the Western Canadian oil and gas industry along with immediate growth opportunities in the U.S. market through Apex Remington, a start-up operation in the US We view this as one of the fastest growing segments of the oil and gas industry and the addition of Apex Distribution would complement our existing Alberta based energy operations Comco Pipe and Supply, Fedmet Tubulars and Triumph Tubular & Supply and our US-based companies Pioneer Pipe and Spartan Energy Tubulars."