Toronto, Ontario-based Russel Metals Inc. announced that it has entered into a stock purchase agreement to acquire all the outstanding shares of City Pipe & Supply Corp. for approximately $160 million. City Pipe & Supply's revenues were approximately $275 million during its last fiscal year.
Founded in 1942, City Pipe & Supply supplies pipe, valves, and fittings to oil and gas companies in the Permian, Eagle Ford, Granite Wash, Barnett and Haynesville basins which collectively represent approximately 60 percent of the active rigs in the United States. City Pipe & Supply operates five distribution centers located in Odessa, Big Spring, Weatherford and Longview, Texas and Hobbs, New Mexico. The current management team will remain in place and Brett Lossin will continue to serve as President.
The transaction will be financed by the cash held within the US of approximately $100 million and the remainder from the bank facility. The transaction is subject to regulatory approval and customary closing conditions. It is expected to close in the fourth quarter of 2019.