Marubeni acquires KMA Manufacturing to diversify into steel mills maintenance in the US
26 May 2008
Japanese sogo sosha, or trading firm, Marubeni has announced the completion of its acquisition of 95 per cent of machining and fabrications comapay KMA Manufacturing LLC, formed in 2005 by combining, Pittsburgh Annealing Box Company, Inc and Metal Services & Technologies.
Marubeni Corp made the acquisition along with its US-based subsidiary, Marubeni America Corporation, through the purchase of equity and subscription to additional equity in KMA, started by two Englishmen Martin McHale and John Kelman
In 2005 Pittsburgh Annealing Box bought the tank division of Allegheny Plastics in Leetsdale, followed by the assets of Spectrum Mechanical Services in Vanport in September the same year.
KMA's headquarter and factory are located in Pittsburgh, Pennsylvania, and provide maintenance services for steel mills throughout the US, including repair and replacement of machinery and related components. KMA also manufactures and provides repair work as subcontractor to equipment and parts suppliers.
KMA has a maintenance services agreement with Nucor Steel Corporation for its steel mill, which is under construction in Memphis, Tennessee. In accordance with the Service Agreement, KMA will construct a new maintenance centre adjacent to the Nucor mill at Memphis to extend maintenance services as a primary service provider and will also expand its services to other Nucor mills located in Arkansas, Mississippi and Alabama.
As most of steel mills in the US are aging and many of them plan to further outsource necessary maintenance works to reduce maintenance costs, Marubeni expects stable and continuous demand for maintenance services. In addition to the new maintenance centre in the south in Memphis, KMA plans to expand its business territory into western parts of the US in the near future.
The plant, ship and industrial machinery division of Marubeni has substantial experience in supplying machinery and equipment for steel mills as an EPC contractor. By taking over the maintenance business of KMA in the US, Marubeni will further expand its range of services to steel mills.
