Lakeside Steel Inc. (TSX-V: LS) said yesterday that it has not received a takeover approach from John Maneely Co., following a trade publication report that John Maneely Co. had Lakeside and another company “in its sights.” John Maneely is a portfolio company of The Carlyle Group.
Lakeside Steel Inc. (TSX-V: LS) (“Lakeside” or the “Company”) responded today to an article published in American Metal Market dated September 28, 2009 (the “AMM Article”) about the possible interest of John Maneely Company (“John Maneely”) in acquiring both Lakeside and Barzel Industries Inc. (“Barzel”).
On September 22, 2009 Lakeside announced its interest in acquiring some or all of the assets of Barzel through the Chapter 11 bankruptcy process. Barzel operates 16 pipe and tube, processing, manufacturing and distribution facilities in the U.S. and Canada.
John Maneely is a large U.S. based steel pipe and tube manufacturer. The majority owner of John Maneely is the Carlyle Group, a large private equity firm, based in the U.S. The AMM Article states that: “Barry Zekelman, John Maneely Co’s president and chief executive officer, said his firm is feeling acquisitive and has Lakeside Steel Inc. and bankrupt Barzel Industries Inc. in its sights.”
Lakeside has not been approached by John Maneely about its possible interest in acquiring the Company. Lakeside has not initiated any process to sell the Company. There is no assurance that John Maneely will approach Lakeside about a possible acquisition or that John Maneely will make any offer to acquire Lakeside. There is also no certainty that even if John Maneely were to approach Lakeside or make an offer to acquire Lakeside that any such acquisition would be completed.
Vic Alboini, Chairman and CEO of Lakeside, stated: “We respect our competitors including John Maneely. We certainly understand that any pipe and tube manufacturer including John Maneely may want to acquire one or more of its competitors to obtain more market share and to prevent competitors from growing through acquisitions.
Ron Bedard, President and Chief Operating Officer of Lakeside said, “We believe that the possible acquisitions of Barzel assets and U.S. Steel Canada Inc. (formerly Stelco Inc.) by Lakeside would be game changing transactions which would create a strong vertically integrated steel company which in turn would create substantial value for our shareholders, our employees and the communities in which we operate.”
Lakeside has also invested $5 million in new threading and upsetting processes for its Welland facilities resulting in the creation of 40 additional jobs and improved operating efficiencies.
Lakeside’s management team and its directors are committed to growing its business both organically and through accretive mergers and acquisitions.
About Lakeside Steel Inc.
Lakeside Steel Inc. is the parent company of Lakeside. Lakeside, located in Welland, Ontario, is a diversified steel pipe and tubing manufacturer. Lakeside’s list of customers includes large oil and gas, mining, automotive and commercial and industrial supply companies. In addition to supplying its products in these industries, Lakeside manufactures pipe and mechanical tubing for the resale market, which is sold to distributors in Eastern Canada and the Northeastern United States. Lakeside manufactures a variety of products for these industries including oil well tubing and casing, mechanical tubing, pressure tubing, automotive tubing, hollows for redraw, line pipe, heating and plumbing pipe, drill rod and specialty tubing. Lakeside serves customers worldwide, either directly or indirectly, in Canada, Australia and the United States.