One of the country’s largest steel manufacturers is acquiring a Pennsylvania-based company specializing in metal poles and steel structures used in utility and other infrastructure work.
Charlotte-based Nucor Corp. isn’t disclosing terms of its agreement to buy Summit Utility Structures LLC and its Sovereign Steel Manufacturing LLC affiliate. For Nucor, which in 2021 rang up profits of about $7 billion on more than $36 billion in sales, the planned deal is a play on the long-term growth prospects of the utility infrastructure market as energy providers and others replace aging equipment and invest in the transition toward renewable energy generation, distribution and storage.
"These businesses fit well into the Expand Beyond part of our strategy to acquire companies who have a direct connection to our industry, offer significant growth opportunities and enhance Nucor's position as the leading manufacturing company in the metals industry," said Nucor President and CEO Leon Topalian. "We intend to grow these businesses to become the preferred solutions provider for utility transmission towers, substations, telecommunication towers and highway signage structures."
Based in West Hazleton, about 100 miles north of Philadelphia, Summit Utility Structures has its roots in Summit Manufacturing Inc., which was founded in 1988 by Raj Pawar and Bob Butterworth. A decade later, Pawar sold the company. Five years after that, he bought PennSummit Tubular out of bankruptcy in 2003 to become a $50 million player in the utility transmission pole market. After selling that business to publicly traded Valmont Industries Inc., Pawar launched today’s iteration of the business in 2012 as a supplier of bolts and base plates before again expanding into tubular poles.
Focused primarily on the Northeast but having done work across the country as well as in Canada and Mexico, Summit and Sovereign are being incorporated into a new Nucor business unit focused on utility, transportation and telecommunications work. Nucor executives said June 7 they plan to build Summit “a nationwide footprint able to service all customers throughout North America.”
Nucor has been on a growth spurt of late, investing in a number of acquisitions that are expanding its product lines. Most recently, Topalian and his team said they would pay $3 billion for C.H.I. Overhead Doors, which employs about 800 people. Nucor shares (Ticker: NUE) rose more than 3% to nearly $134 June 7. Year to date, they have climbed more than 15%, growing the company’s market capitalization to more than $35 billion.