Russel Metals Inc. announced that it has entered into an agreement with Marubeni-Itochu Tubulars America Inc. (MITI), whereby Russel Metals will sell its 50 percent equity interest in TriMark Tubulars Ltd. for approximately $61 million, subject to normal course closing adjustments.
The transaction is subject to customary regulatory approvals and is expected to close in the third quarter of 2023.
TriMark was created in July 2021 when Russel Metals and MITI combined their respective Canadian OCTG/line pipe businesses. At that time, Russel Metals had approximately $141 million of net assets in its Canadian OCTG/line pipe business. With the formation of Trimark, Russel converted approximately $109 million into cash and retained a $32 million equity interest in TriMark.
John Reid, President and CEO of Russel Metals commented, "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 $375 million of capital from the OCTG/line pipe business and have reinvested in our core segments at superior returns with lower risk. Additionally, we have retained significant financial flexibility to opportunistically grow our company and return capital to our shareholders."