CAROL STREAM, Ill., Jun. 17 -- Tri Star Metals Inc. LLC along with its parent company, Hagener-Feinstahl, today announced it completed on June 14 its merger with Pinnacle Metals, Inc., a privately held and profitable wire and bar, stainless steel, and nickel alloys production company, adding it to its family-owned group of stainless steel and nickel alloy companies. Pinnacle Metals will operate as Tri Star--Pinnacle Metals through the year-end, when it will assume the Tri Star Metals name.
Tri Star Metals entered this merger from a position of financial and operational strength due to the Company's solid balance sheet, its lack of debt over the previous eight years, and its ability to finance growth internally.
"The addition of Pinnacle Metals marks the completion of Phase I in Tri Star Metals' North American expansion strategy," said Dan Buba, Chief Executive Officer of Tri Star Metals. "Pinnacle Metals is a fast-growing, profitable market leader, and we believe the combination of its manufacturing experience and facilities with our existing reputation as an international manufacturing and distribution organization with financial soundness, quality service and distribution excellence will ultimately enhance our joint ability to serve the world's market."
The merger expands Tri Star Metals' North American footprint via the addition of a 130,000 square-foot manufacturing facility in Freeport, Ill. and establishes Tri Star Metals as a fully integrated wire mill with multiple shipping locations and two production facilities. The Company will immediately increase manufacturing capacity at the new facility by repurposing 35,000 square feet (or 27 percent) to add equipment that supports new growth markets, such as annealing and drawing capacity for stainless and nickel alloy rod, bar and wire. Tri Star Metals believes the increase in production will allow it to better serve customers by establishing a global production platform with manufacturing facilities in North America as well as Europe.
The Company also announced Hagener-Feinstahl's owners, Hans Juergen Bender and Ingo Bender, toured the Freeport manufacturing facility and have committed to help expand its capacity. They also will mobilize manufacturing experts and engineers from Germany, temporarily relocating them to the new North American plant, to provide expert technical consulting to Tri Star Metals as it implements and utilizes the new equipment to maximize efficiency.
The augmented company will blend the production and administrative employees from Pinnacle Metals with Tri Star Metals' and expand the expertise of Tri Star Metals' management with the addition of three executive leaders from Pinnacle Metals:
-- Bill Pigott, former Vice President of Production will serve as Vice President, Manufacturing
-- Nick Pigott, former Vice President of Operations will serve as Vice President of Stainless and Nickel Alloys and also will join Tri Star Metals' management committee to help represent Pinnacle stakeholders in all major strategic and financial decisions
-- Kurt Payton, former Vice President of Sales will serve as Vice President of the Eastern Division.
"We believe that combining the strengths and leveraging the synergies of Tri Star Metals and Pinnacle Metals will bring clear and tangible benefits to key stakeholders via an expanded product portfolio, global manufacturing capabilities, and broader involvement in the industry," said Jay Mandel, President, Tri Star Metals. "This merger will increase our global buying power to 35,000 metric tons per year, enhance our profile among producing mills, and empower us to better negotiate terms and pricing on raw materials to meet customer needs and help them maintain competitiveness in the worldwide market."
As a result of the merger, Tri Star Metals has gained direct control of manufacturing timelines and production. This will enable the Company to provide even greater flexibility and enhanced responsiveness to customer orders and requests. The company also will be able to offer domestic production of stainless steel and nickel alloys in rod, bar and wire, which can help eliminate stock-outs and shorten lead times on special runs.
"Going forward, Tri Star Metals will continue to focus on building its market position and strengthening its presence in North America," said Jim Roach, Executive Vice President, Tri Star Metals. "The Company has managed profitably through the economic crisis, avoiding layoffs and, in fact, doubling its sales force. The Company has gained more than 150 new customers since January 2010 and plans to continue this momentum."
"We are pleased to be a part of a transition that helps further establish Tri Star Metals as a premier stainless steel and nickel alloy international manufacturing and distribution organization," said Nick Pigott, newly the Vice President of Stainless and Nickel Alloys at Tri Star-Pinnacle Metals. "We look forward to continuing growth as a member of the Hagener-Feinstahl and Tri Star Metals family."
About Tri Star Metals
Tri Star Metals has served customers for the last 25 years from its modern facilities, conveniently located in the Chicago, Illinois, suburb of Carol Stream. Its drive-through warehouse is designed for maximum efficiency and functionality, and the Company's extensive inventory allows it to respond immediately to customers' needs for aluminum and stainless steel rod, bar and wire stock, often providing next-day delivery. Tri Star is the sole source for its proprietary line of premium specialty metals products including: TRI-CUT(R) free machining stainless steel bars, TRI-BRITE(TM) EPQ stainless steel wire, TRI-COAT, and TRI-COAT WAX stainless steel cold heading wire. For more information, please visit www.tristarmetals.com.