Maverick Buys Colombian Tube Producers
Tubos del Caribe is a Colombian manufacturer of oil country tubular goods and line pipe; Colmena S.A. is a Colombian manufacturer of steel electrical conduit and other pipe and tube products used in a variety of industrial applications; and Advance Corp. is a Houston-based distributor of OCTG and electrical conduit. The purchase price, a total of $186 million including about $30 million of assumed debt, will be paid through a combination of cash at closing, a $15 million unsecured promissory note and an escrow.
C. Robert Bunch, Maverick's chairman and CEO, stated, “The combination of Maverick with the acquired companies satisfies our stated objective of expanding our geographic presence in both our energy and industrial businesses. Each of these companies has an outstanding reputation in its home markets, a demonstrated ability to export its products to North America and other parts of the world, and an impressive trend of growth and profitability. In addition, the acquisition provides the capacity and a proven vehicle for future growth throughout the world.”
Maverick expects to finance the purchase of the acquired companies through a combination of debt and the anticipated proceeds from the sale of its HSS industrial product line announced on May 11, 2005. In connection with the transaction, Maverick has obtained a commitment from JP Morgan Chase for a new $325 million senior credit facility (expandable up to $450 million) that will also be used to refinance existing bank borrowings and provide additional liquidity for future growth.
In other Maverick news, C. Robert Bunch was appointed chairman and CEO effective May 18, 2005. A Maverick board member since 1991, he had been serving as acting CEO since October 2004 and chairman since January 2005.