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Fort Dearborn Advisors Arranges Sale of Standard Steel & Wire

February 17, 2016, 07:22 AM
Filed Under: Mergers & Acquisitions
Related: Alliance Steel

Fort Dearborn Advisors announced the sale of substantially all of the operating assets of Standard Steel & Wire, Inc. (“SS&W” or the “Company”) to Alliance Steel, LLC. Standard Steel & Wire was established in 1920 and purchased by Dennis Hack and his brother in 1981. SS&W is a steel service center that provides slitting, gauge correction, rolling mill and edging services to prepare coils for a variety of customers. The Company processes cold rolled, hot rolled pickled and oiled, hot-dip galvanized, electro-galvanized steel and other products from prime steel. Specialty grades can include spring steel, aluminized steel and tin coated steel. Steel products include cold and hot rolled in drawing, commercial and tempered quality, often in restricted gauge tolerances.

As part of his retirement planning, Dennis Hack decided to sell his Company despite the turbulent industry environment.  The owner had expressed his desire to retain the operating plant due to the real estate location and its potential for appreciation based alternatives uses of the property.  In August 2015, the Company hired Fort Dearborn Advisors to explore a sale of the Company.

During 2014 & 2015, increases in imported steel to the U.S. and stagnant demand resulted in dramatic decreases in the price of steel. The Company’s financial performance was impacted as a result and Fort Dearborn advised the management on expense controls and working capital management.

Fort Dearborn utilized its investment banking expertise and worked with the management team to create a sale transaction strategy. The strategy called for a vigorous sale process while managing the business through the challenging operating environment. Fort Dearborn quickly developed marketing materials and a targeted list of potential acquirers. Fort Dearborn's marketing efforts yielded multiple indications of interest.  After plant visits, initial due diligence, and detailed discussions with prospective buyers, Fort Dearborn assisted the owners in selecting the best potential acquirer based on strategic fit, deal structure, achievement of owner’s objectives and speed to close.  SS&W agreed to sell substantially all of the operating assets and select equipment to Alliance Steel. The owner achieved his goal of retaining the ownership of the real estate.

Dennis Hack, the owner of Standard Steel stated that “Fort Dearborn conducted a robust sales process and guided me through each step of the process with outstanding professionalism”. 

Fort Dearborn and management worked very closely with legal counsel, Mark Kosminskas, of Kelly, Olson, Michod, DeHaan & Richter, L.L.C. though the contract negotiations and the due diligence process.

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