HOUSTON - Reliance, Inc. (NYSE: RS), a global diversified metal solutions provider, has announced the successful acquisition of American Alloy Steel, Inc., a specialty steel distributor based in Houston, Texas. The transaction, effective as of Monday, was part of Reliance's strategic initiative to enhance its value-added processing and fabrication capabilities and to expand its specialty carbon steel plate product offerings.
American Alloy Steel, founded in 1971, is recognized for distributing a variety of specialty carbon and alloy steel products, including pressure vessel quality (PVQ) materials. The company reported annual net sales of approximately $310 million for the year ending December 31, 2023.
The acquisition is expected to be immediately accretive to Reliance's operations, according to the company's statement. Importantly, the existing management team of American Alloy will continue to lead the company, ensuring stability and continuity of service for customers and employees alike.
Reliance, established in 1939 and headquartered in Scottsdale, Arizona, operates as the largest metals service center company in North America. It boasts a network of over 315 locations across 40 states and 12 countries outside the United States. The company is known for focusing on small orders with quick turnaround times, and in 2023, approximately 51% of its orders included value-added processing services.
This news is based on a press release statement from Reliance, Inc.
InvestingPro Insights
The acquisition of American Alloy Steel by Reliance, Inc. (NYSE: RS) marks another strategic move for the metal solutions provider, aimed at bolstering its product offerings and service capabilities. As investors and stakeholders consider the potential impact of this acquisition on Reliance's financial performance, several metrics from InvestingPro provide a snapshot of the company's current standing:
- The company's Market Cap (Adjusted) stands at $19.13 billion, reflecting its significant presence in the industry.
- Reliance's P/E Ratio (Adjusted) for the last twelve months as of Q4 2023 is 14.32, suggesting a valuation that might appeal to investors looking for reasonably priced earnings growth potential.
- A notable Revenue Growth (Quarterly) for Q4 2023 shows a decline of -7.57%, indicating recent challenges in revenue expansion.
Investors looking into Reliance's future earnings potential may be interested in the Next Earnings Date set for April 25, 2024, which could provide further insights into the company's operational performance post-acquisition.
For those seeking more in-depth analysis, InvestingPro offers additional insights through its platform. There are currently 8 more InvestingPro Tips available that could help investors make more informed decisions about Reliance, Inc. To access these tips and unlock the full potential of the InvestingPro platform, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
Given the company's recent acquisition, these InvestingPro metrics and tips could prove invaluable for stakeholders looking to understand the potential impact on Reliance's market position and financial health.
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