Jan 3 2007
Nucor Corporation announced that it has agreed to make a tender offer for all of the shares of Harris Steel Group, Inc. at C$46.25 per share. This tender offer will remain open for a minimum of 35 calendar days and has the full support of the Boards of Directors of both Nucor and Harris Steel Group ("Harris Steel"). In conjunction with this offer, Harris Steel has entered into a Support Agreement with Nucor. Harris Steel's Board of Directors is unanimously recommending that its shareholders tender their shares to this offer. In addition, John Harris, Chairman and Chief Executive Officer of Harris Steel, and other members of the Harris family along with Paul Kelly, the President and Chief Operating Officer of the Company, have entered into a Lock-Up Agreement to irrevocably tender their shares to this offer. This Lock-Up Agreement will deliver 13,715,440 shares, representing in excess of 50% of the shares of Harris Steel to Nucor.
Nucor will pay C$46.25 in cash for each share of Harris Steel. The offer places an approximate value of C$1.25 billion (US$1.07 billion) on the equity of Harris Steel. As of September 30, 2006, Harris Steel had net debt of approximately C$123 million (US$106 million).
"The acquisition of Harris Steel Group significantly advances Nucor's downstream growth initiatives," said Nucor Chairman and CEO, Dan DiMicco. He added, "Harris Steel has been a strong partner of ours for almost three years, is a company that we know well, has a management team whom we respect, and will be a highly complementary fit with Nucor. Harris Steel provides Nucor with immediate and broad geographical reach and with considerable scale and growth opportunities."
Completion of the acquisition will occur upon satisfactory resolution of regulatory approvals in the US and Canada. Upon conclusion of the transaction, Nucor plans to allow Harris Steel to operate as a separate, wholly owned subsidiary. The transaction is expected to be immediately accretive to Nucor. Nucor does not expect this transaction to affect the current supplemental dividend practice.