Reliance Steel to Purchase Phoenix Metals

Los Angeles-based Reliance Steel & Aluminum Co. said it agreed to buy closely held metal service center operator Phoenix Metals Co. for an undisclosed price to boost its operations in the Southeast. Atlanta-based Phoenix Metals could have fetched as much as $70 million, said Smith Barney Inc. analysts Charles Bradford and Yvonne Valera in a report. The company has annual sales of $120 million. Reliance Steel is buying up companies amid a rapid consolidation of metal processors and distributors. The purchase of Phoenix Metals, which processes steel and aluminum at plants in Alabama, Florida and North Carolina, is expected to be completed in mid-December. Reliance operates 43 metal service centers in 15 states. Service centers cut and shape metals to customer specifications and deliver the products on a just-in-time basis. Reliance shares rose $1.25 to close at $27.75 on the NYSE.