SIMS METAL ACQUIRES NORTHEAST METAL TRADERS

NEW YORK, March 21, 2023 /CNW/ -- Sims Metal, a global leader in metal recycling, today announced that the company will acquire the commercial and operating assets of Pennsylvania-based Northeast Metal Traders (NEMT). The acquisition is anticipated to close in mid-April 2023.

NEMT, a non-ferrous scrap metal wholesaler and broker, operates a single-scale site in Philadelphia and has extensive supplier and end-consumer relationships that stretch across the eastern United States. NEMT is one of the largest copper recyclers in the U.S. They process and sell approximately 60,000 tons of non-ferrous metal per year.

The transaction consideration implies an EV/EBITDA multiple of 4.8x on a pre-synergies basis (including estimated working capital).

The NEMT acquisition is in line with the company's growth strategy, which includes the expansion of the non-ferrous business in North America (Sims Metal North America), and the allocation of growth capital expenditure toward assets that yield a minimum post-tax internal rate of return (IRR) of 15 percent.

Furthermore, it is consistent with Sims Metal's purpose and meets the core strategic elements of the merger and acquisition framework ? targeting businesses with operations in large markets, operating best-in-class assets with robust sales channels to an expanding customer base, and producing high-quality differentiated outputs. Disciplined capital allocation remains a focus for the business, and Sims Metal intends to fund this acquisition through recycling surplus and/or underperforming capital.

"We are very excited about this bolt-on acquisition and the opportunities it opens up for the Sims Metal North America business," said Alistair Field, managing director and chief executive officer of Sims Limited. "The Northeast brings commercial and operating synergies, as well as provides us with a significant and complementary footprint in Philadelphia."

This acquisition will substantially increase the copper volumes in the metal business, as the Northeast focuses predominantly on high-quality copper granulation. Furthermore, with the demand for copper scrap growing rapidly, it will strengthen Sims Metal's exposure to the energy transition and decarbonisation.

About Sims Metal
Founded in Sydney, in 1917, Sims Metal, has grown from being an Australian-centric company to one of the most significant metal recycling companies in the world. A division of Sims Limited, Sims Metal has bases of operation in Australia, the United Kingdom and the United States where the company buys and processes recyclable ferrous and non-ferrous metal and sells the recycled material to manufacturers in 30 countries. Each year, Sims Metal recycles approximately 10 million tons of metal across its global operations. In line with their shared purpose, create a world without waste to preserve our planet, Sims Metal is preparing for, and adapting to, the significant industrial and environmental changes in society and the industry. Visit www.simsmm.com to learn more. 

SOURCE Sims Metal