Quanex Corp. announced the closing of the asset purchase of the Monroe, Mich. steel mill of North Star Steel, a subsidiary of Cargill, Inc., for $115 million in cash. The company financed the acquisition by borrowing against its $310 million revolving credit facility.

The Monroe minimill can produce over 500,000 tons of special bar quality and engineered steel bars with diameters ranging from 0.5625- to 3.25-inch, primarily serving the light vehicle and heavy-duty truck markets. The newly acquired business, with approximately $175 million annualized sales and 380 employees, will be integrated with MacSteel and renamed MacSteel Monroe. The facility has both process and environmental ISO and QS certifications.

"The acquisition of Monroe directly supports and benefits our core MacSteel business and enhances our efforts to provide Quanex's vehicular customers with a broader range of high quality bar products," said Raymond A. Jean, Chairman and CEO of Quanex. "Monroe's production of smaller diameter bars complements MacSteel's 1- to 6-inch size range and expands our customer base and product offerings. Monroe is a profitable operation and we expect earnings accretion in year one. The integration of the three mills from an operational planning standpoint will provide attractive opportunities for productivity gains. Acquiring Monroe is exactly the type of acquisition we seek as we profitably grow Quanex's core businesses," said Jean.

Founded in 1927, Quanex Corp. is an industry-leading manufacturer of engineered materials and components for the Vehicular Products and Building Products markets. Quanex is based in Houston, Texas.