Global Fastener News

1985 FIN – Ivaco Adds AHL Group to List of Acquisitions

March 04
00:00 2010

1985 FIN – Ivaco Adds AHL Group to List of Acquisitions

By Dick Callahan

Montreal-based Ivaco Incorporated has purchased 54.6% of the shares of AHL Group Limited of Toronto – formerly Automotive Hardware Ltd.

Ivaco bought the shares from the executors of the estate of Irwin Goldhart an will make an offer to purchase the remainder of the shares for the same consideration paid to the estate, the company said.

The purchase price paid to the estate was equivalent to $12 per Class X Non-voting or Class Y Voting share of AHL and was satisfied by the issuance new Series E Preferred shares and Class A Subordinate Voting shares of Ivaco.
For each 100 Class X or Class Y shares of AHL the estate received and the remaining shareholders will be offered 24 Ivaco Class A Subordinate Voting shares for the remaining 50 of such AHL shares.

Paul Ivanier, Ivaco’s president and COO, said the acquisition of AHL Group is a further step in Ivaco’s program to grow through acquisition. He also told FIN Ivaco does not have any plans to make any material change in the business of management of AHL.
The purchase agreement with the estate calls for the establishment of a separate company to continue the business of AHL’s Docap Division, a distributor of automotive aftermarket and mill supply products. This separate company will be owned two-thirds by Ivaco and one-third by Sidney Goldhart, currently chairman of AHL and the nephew of the late Irwin Goldhart.

AHL itself underwent reorganization earlier this year. The company changed its name from Automotive Hardware Ltd. and amalgamated with three of its wholly owned subsidiaries.
The previous operating units, known as Automotive Hardware, Automatic Screw Machine Products and Federal Bolt & Nut became a single unit – Federal Bolt & Nut.

The company then operated with three units: Docap; Federal Bolt & Nut, a manufacturer and distributor of industrial fasteners; and Arrowhead Metals Ltd., probably Canada’s leading manufacturer of copper and copper alloy and mill products.

Also earlier this year, AHL sold its 51% ownership in Russell, Burdsall & Ward Corporation (RB&W) back to RB&W for US$20 million.
As part of this transaction $2.5 million of accrued but unpaid preferred dividends were waived and RB&W’s continuing obligation to pay $1 million annually in preferred dividends was terminated.
RB&W originally sold the preferred shares to enable it to purchase part of Lamson & Sessions’ fastener business.

AHL reported sales of $145.9 million and net earnings of $2.4 million for the year ended December 31, 1984.
For the first quarter of 1985, AHL reported sales of $36.9 million and net earnings of $1.2 million.

Ivaco reported net sales of Canadian $1.2 billion and net earnings of $33.8 million for the year ended December 31, 1984.
For the first quarter of 1985, Ivaco reported net sales of $304.3 million – up from $288.5 million for the same period of 1984; net earnings of $6..4 million, down from $8,1 million for the same period of 1984; and an earnings per share of 23 cents, down from 39 cents for the same period in 1984.

Ivaco went public in 1969. Sales at that time ran $11 million. Today sales are running at an annual rate of some $1.2 billion.
Ivaco accomplished this growth through acquisitions. In 1970, Ivaco made its first acquisition – Ingersoll Machine & Tool. They also began construction on the rolling mill at L’Orignal.
In 1971, Sivaco Quebec was acquired, and the company built a new wire mill at Ingersoll, Ontario, starting Sivaco Ontario.
Also in 1971, Ivaco Rolling mills began production, the companies first step toward vertical integration.

In 1973, the company bought Niagara Wires; converted Virginia Wire & Fabric into a producer of wire and wire products; and opened a new nail mill in Nova Scotia.
In 1974-75, the company began making steel, and the new Ingersoll Fasteners plant was completed.
In 1976, nail production began at Virginia.

In 1978, Lundy Steel and Galano were acquired, and two new operations were started: Florida Wire & Nail at Quincy, Florida, and Infasco Nut at Toronto.
In 1979 Atlantic Steel of Atlanta, Georgia, was acquired, adding 800,000 tons of steelmaking capacity.
Capitol Wire & Fence and control of National Wire were also acquired in 1979.

In 1980, Ivaco bought Wrights Canadian Ropes of Vancouver, and acquired a 50% interest in Bakermet at Ottawa, a steel scrap processing concern.
In 1981, Florida Wire & Cable and P.C. Drop Forgings were acquired.
In 1983, Ivaco achieved majority interest of Laclede Steel and its 800,000-ton capacity.

The recently issued 1985 Financial Post booklet of the 500 largest Canadian corporations ranks Ivaco as the 74th largest company in Canada based on sales, 84th by assets, and the 95th by net income.
Ivaco is one of the 12 largest steel producers in North America, and with a wire rod capacity in excess of one million tons per year, is the largest producer of wire rods. The company is also the world’s largest producer of nails.

All told, Ivaco is a steel producer with annual steelmaking and rolling capacity of two million tons. Its products include steel billets, hot rolled bars and shapes, wire rod, wire, welded wire fabric, nails, fencing, fasteners, pipe, forgings and precision machined components, wire ropes and cables, prestressed high carbon wire and paper machine clothing.
Ivaco has 35 plants with 16 in Canada and 19 in the United States. ©1985/2010 Fastener Industry News.

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