Commercial Metals Co. has entered into a definitive agreement to acquire engineered products and solutions provider Tensar for $550 million in a move that will increase the former's footprint in the construction steel reinforcement market, the companies said Dec. 7.
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"This compelling acquisition advances CMC's strategy to expand our leadership in construction reinforcement, with value-added products that complement our existing offering," CEO Barbara Smith said in a statement. "Tensar will create a powerful platform for incremental growth into complementary high-margin engineered products that target CMC's largest core market, construction, serving end-use markets and customer segments where we have strong and existing relationships."
Through its global operations, Tensar provides engineered solutions for subgrade reinforcement and soil stabilization used in road, infrastructure and commercial construction projects.
"This transaction will strengthen CMC's position as a global reinforcement solutions provider, capable of addressing multiple early phases of commercial and infrastructure construction, including subgrade, foundation and structures," Smith said.
The long steel producer and fabricator said the transaction will allow it to benefit from secular infrastructure spending and environmental trends, as Tensar's products and solutions offer superior eco-friendly performance compared with conventional ground reinforcement and soil stabilization methods.
The move by Texas-based CMC follows dual announcements Dec. 6 by Nucor and Liberty Steel USA to build and restart long steel production, respectively, in the US. All three companies cited an anticipated growth in US construction spending as motivation for the announced moves.
Expectations increased for sustained construction spending after the US passed a $1.2 trillion infrastructure bill in November.