Vallourec to take over OMSCO

Vallourec to take over OMSCO

French seamless steel tubes producer Vallourec announced yesterday that its subsidiary Vallourec & Mannesmann Tubes signed a contract to acquire the assets of Houston, Texas-based OMSCO. According to a Vallourec statement, the acquisition of the assets will cost $120 million. However, the transaction, which is expected to be completed on or around September 30, 2005, is subject to US regulatory approval. The acquisition will allow Vallourec to strengthen its position in the high value-added drill pipe market, particularly in North America. Bill Buckley, President and CEO of ShawCor, OMSCO’s parent company, said of the proposed acquisition: "ShawCor's strategy is to focus on its core businesses. While OMSCO is a sound business, it has no strong technological or other connections to ShawCor's remaining businesses and thus was not considered a core business. It is anticipated that the proceeds from the sale of OMSCO will be invested in the company's core pipeline businesses, which have a highly favorable outlook in the longer term, and for general corporate purposes. Given V&M's reputation for quality and service, it is expected that OMSCO's customers and employees will benefit from the transaction."