Tenaris S.A announced recently the completion of its previously announced acquisition of IPSCO Tubulars, Inc., a U.S. manufacturer of steel pipe, from PAO TMK. The acquisition price was determined on a cash-free, debt-free basis, and the final amount paid in cash was USD 1,067M (including approximately USD 220M in working capital). Tenaris will consolidate IPSCO’s balance sheet and results of operations in its consolidated financial statements beginning in the Q1 of 2020.
In connection with the closing of the transaction, the parties entered into a 6-year master distribution agreement whereby, Tenaris will be the exclusive distributor of TMK’s OCTG and line pipe products in the United States and Canada.
Tenaris’s existing U.S. industrial and service network located primarily in the south is complemented by IPSCO’s facilities located mainly in the mid-western and northeastern regions of the country. IPSCO’s steel shop in Koppel, PA, is Tenaris’s first in the United States, providing vertical integration through domestic production of a relevant part of its steel bar needs. Its Ambridge, PA, mill adds a second seamless manufacturing facility and complements Tenaris’s seamless plant in Bay City, Texas.
