Reliance Steel Obtains $2 Billion Credit Pact to Back PurchaseChristine Idzelis
Reliance Steel & Aluminum Co., North America’s largest metals service-center company, got a new $500 million term loan and a $1.5 billion credit line to help back its acquisition of Metals USA Holdings Corp.
The five-year credit pact gives the Los Angeles-based company an option to increase the revolving credit line by $500 million, Reliance said today in a statement distributed by Business Wire.
Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co. arranged the debt for the company, according to the statement.
“These financing transactions are a significant step in obtaining the financing necessary to complete our previously announced acquisition of Metals USA that we expect to close in the 2013 second quarter,” David Hannah, Reliance’s chairman and chief executive officer, said in the statement.
The company agreed to acquire Metals USA Holdings for about $766 million to add 48 distribution centers across the country, the companies said in a Feb. 6 statement.
Under a revolver, money can be borrowed again once it’s repaid; in a term loan, it can’t.