The £16 billion takeover

Big numbers = Big impact??

When a company with a turnover in excess of £16 billion purchases a large UK steel business, it’s time to sit up and listen.

On the 4th of October 2022, exactly that happened when Marubeni-Itochu Steel Europe GmbH (MISEA), the European arm of Japanese steel giant Marubeni-Itochu Steel Inc. (MISI), acquired 100% of the shares from BREAL Capital and took over as owners of B&M Steel.

What do I need to know about the acquisition?

In a press release from MISI in October 2022, they stated: “Through this acquisition, MISI will establish a strategic position in the UK steel market, which is a growth market with a steadily increasing population and consistent demand for construction materials. MISI will expand the business areas it is active in, and enhance its market presence through B&M’s wide range of customer networks, variety of materials and advanced sales approaches, such as e-commerce.”

The steel sector in the UK is dominated by a handful of large national and multinational businesses, where consolidation is not uncommon. This acquisition is ground-breaking since, before this deal, MISI had no interests in the steel stockholder space in the UK or Europe.

It was no secret within the industry that BREAL Capital were seeking a buyer for B&M Steel, but the sheer size of the new owners cannot be ignored.

Marubeni-Itochu Steel Inc. wants B&M Steel Group to grow to be the number one steel stockholder in the UK.

The Metal Magazine was invited to cover the story. I met with Kyle Greenwood, the Commercial and Operations Director for B&M Steel, in late 2022 to record a podcast (due for release in early 2023) and a video interview about the acquisition.

Kyle spoke candidly about his involvement in the company over the last 4 years and his role in helping to develop operational efficiencies across the group.

BREAL Capital acquired Barclay & Mathieson (B&M) from Stemcor in 2015, which at the time was operating at sub-optimal levels.

BREAL’s strategy – BUY AND BUILD – quickly added Industrial Metal Supplies (IMS), Avon Steel, Steel Plate & Sections (SPS) and Abram Pulman to the group of companies.

Industrial Metal Services (IMS), acquired by Marubeni-Itochu as part of the acquisition of the B&M group, use a series of Kaltenbach saw lines, which can accommodate bar up to 18,300mm in length and have a straight cut tolerance of just +/-1mm
Industrial Metal Services (IMS) use a series of Kaltenbach saw lines, which can accommodate bar up to 18,300mm in length and have a straight cut tolerance of just +/-1mm

In 2021, BREAL decided that they had two options: They could sell the group to allow the new owners to develop their own future path, or they could continue acquiring and investing for a larger sale at a later date.

Marubeni-Itochu Steel Inc. (MISI) has a turnover in excess of £16 billion annually. With such revenues of traded commodity steel, margins are low. Their strategy appears to be a simple one: Acquire a number of high-profit steel businesses across the globe. It would seem that the acquisition of B&M Steel is the first of many.

Their plans could not be more clear. MISI wants B&M Steel to be the number one steel stockholder in the UK. This goal is not based on pure turnover or tonnes of stock, but is based on profit.

B&M Steel have a proven track record and their own roadmap for acquiring and improving steel companies, so it is inevitable that more steel businesses will be acquired by the group in the not-too-distant future.

Who are B&M Steel?

The group currently comprises B&M Steel, Steel Plate & Sections (SPS), Industrial Metal Services (IMS), Avon Steel and Abram Pulman – steel businesses that were acquired and integrated over a 7-year period by BREAL Capital.

Each of these businesses had been purchased while they were trading in sub-optimal conditions or required a major turnaround.

With this varied collection of companies, B&M has a diverse product and service offering in a number of markets, including oil and gas, shipbuilding, offshore and on-land renewable energy, architectural and access & safety products.

More recently, investment into an e-commerce platform has brought significant growth across the entire portfolio.

Barclay & Mathieson are historic names in the UK steel sector, with the original company having been founded in 1877, but B&M Steel wouldn’t have been seen as a major player when they were acquired by BREAL Capital in 2015.

The change in the business has been fast and impressive. With a full rebrand, a growing e-commerce platform, expanding stock range and a shift of focus to service over price, the business has fundamentally changed.

This photo of the IMS site at Shoeburyness in Essex shows the scale of their impressive saw cutting capabilities, where machines run 24/7. IMS were recently acquired by Marubeni-Itochu as part of the acquisition of the B&M group from BREAL Capital.
This photo of the IMS site at Shoeburyness in Essex shows the scale of their impressive saw cutting capabilities, where machines run 24/7

What’s next?

Under new ownership, with a seemingly unlimited investment opportunity through the backing of the Marubeni-Itochu group, B&M are ideally positioned to continue their success in the UK.

We will keep a close on the business as it enters a new era, and look forward to seeing how each division of the business continues to develop.

In the extended interview that we conducted with Kyle for season three of The Metal Guys Talk Business, we talk in more detail about positioning B&M for sale, the future outlook for the business post-acquisition, the environment and legislative changes for UK steel companies, and the environmental challenges that we all face.

The podcast is due to be released in February 2023. Subscribe now via your preferred podcast platform so that you’ll be notified when it’s available.

What are your thoughts about this acquisition? Share your comments on LinkedIn or Twitter, we’d love to hear from you.

Find out more about Marubeni-Itochu Steel Inc. by visiting their website: www.benichu.com

About the author

Latest articles

Featured article
  • Women with Metal

    Women with Metal

    It’s been 7 weeks since the first Women with Metal event and the 2nd edition of this sell out conference has already been booked top take place on 29 October 2024. Kirsty is increasing the size and scale of the event and has booked a hall at the ICC Birmingham for year 2 with the…

    Read article →

  • Organized Crime Drives Metal Theft Epidemic: UK Economy Loses Half a Billion Annually.

    Organized Crime Drives Metal Theft Epidemic: UK Economy Loses Half a Billion Annually.

    A newly released report by the All-Party Parliamentary Group on Metal, Stone, and Heritage reveals that metal theft orchestrated by organized crime groups is costing the UK economy a staggering half a billion pounds each year. The comprehensive study, titled “Tackling Metal Theft,” exposes a rising trend in metal-related crimes since 2019, amounting to a…

    Read article →

  • Van Leeuwen: The Energy Project

    Van Leeuwen: The Energy Project

    In December 2021 Jill Clements told me about the Energy Project that had been signed off by Van Leeuwen UK. Jill was animated when talking about the news, and excitedly explained the potential that this opened up to her and the team. “I am very excited about it. I am really happy that finally we…

    Read article →

  • Drywall Steel Sections Secures £9.5 Million WMCA Investment

    Drywall Steel Sections Secures £9.5 Million WMCA Investment

    £13 million was all it took for a family run manufacturing business to make a monumental transformation in the historic heart of the steel industry! Drywall Steel Sections Ltd are on the move after securing loan funding of £9.5 million from the West Midlands Combined Authority (WMCA). Their Cradley Heath site was no longer fit…

    Read article →

  • The NASS Golf day & Summer Gathering 2023

    The NASS Golf day & Summer Gathering 2023

    On the 29th of June, Matt Tipper, Stewart Andrews and I had a swing of the clubs at Priory Breadsall in Derby. A week later, on the 6th of July, I attended the Summer Gathering in central Birmingham. Two entirely different events, seven days apart, both hosted by The National Association of Steel Service Centres…

    Read article →

  • The Stainless Steel Industry Meets at the BSSA Annual Conference & Dinner

    The Stainless Steel Industry Meets at the BSSA Annual Conference & Dinner

    The British Stainless Steel Association (BSSA) met at The Grand Hotel in Birmingham in May 2023 for their annual conference and dinner. Having attended the last four BSSA annual conferences and this year’s Food and Beverage Industry event (link to article), it was great to catch up with familiar faces from the industry and new…

    Read article →

  • Q2 Review: Analysing The Recruitment Landscape

    Q2 Review: Analysing The Recruitment Landscape

    Large corporate companies are facing challenges attracting new talent and retaining skilled staff especially when their salary structures, work flexibility and staff benefits are outdated compared to smaller, more agile SMEs. Smaller companies can have the advantage of being able to offer more flexibility and quicker decision-making, meaning they’re a more appealing option for certain…

    Read article →

  • How to use LinkedIn for YOUR Metal Business.

    How to use LinkedIn for YOUR Metal Business.

    The below presentation was given at the National Association of Steel Service Centres (NASS) 2023 Summer Gathering. In 12 days I’ll have been using LinkedIn for 12 years! On the day I joined I thought: “Wow! This business Facebook thingy is incredible! Everyone I want to do business with is right here, this will be…

    Read article →

  • Leading the Charge: Steel Dynamics in the Nuclear Industry

    Leading the Charge: Steel Dynamics in the Nuclear Industry

    Prime Minister Rishi Sunak recently unveiled the Great British Nuclear initiative, marking a significant milestone in the UK’s pursuit of a sustainable energy future. With nuclear power playing a crucialrole in achieving net-zero emissions and reducing greenhouse gases, this announcement signals a remarkable leap forward in the nation’s commitment to clean and reliable energy sources.…

    Read article →

  • Steel Dynamics Group Ltd. Acquires Ferrari Stainless & Alloys.

    Steel Dynamics Group Ltd. Acquires Ferrari Stainless & Alloys.

    Steel Dynamics Group Ltd. Acquires Ferrari Stainless & Alloys Ltd. Launching P&P Non Ferrous: A Gateway to Enhanced Customer Services and Expansion Down South In a strategic move to bolster its position in the industry, Steel Dynamics Group Ltd. proudly announces the successful acquisition of Ferrari Stainless & Alloys Ltd. in Wimborne. This transformative development…

    Read article →

  • Sustainability is key to modern manufacturing

    Sustainability is key to modern manufacturing

    During my time supplying specialist metals into the manufacturing sector, I have noticed several things regarding the supply chain local to me in South Yorkshire. 1 Large Manufacturing companies often have difficult onboarding processes.  This makes it difficult for smaller SMES or new market entrants to be able to supply them. 2 Manufacturing companies are…

    Read article →

  • Lasers: The Tesla of Tooling

    Lasers: The Tesla of Tooling

    Welcome back, I’m LaserEd, and I work with lasers. I’ll be laser-educating for The Metal Magazine and I hope it results in more metal parts being lasered! First of all, I haven’t had an accident after writing my last article about Laser Safety. I have been busy researching. Although it is time consuming, I love…

    Read article →

  • Implementing QMS Certifications for Small Businesses and Start-Up Companies

    Implementing QMS Certifications for Small Businesses and Start-Up Companies

    Welcome to the fourth and final instalment of this short series on Quality Management System certification for small businesses and start-up companies. In this 4 part series I have been explaining exactly what third-party certification involves, and how you can level up your business through this process. The standard we are focussing on is ISO9001:2015, as…

    Read article →

Get notified when we publish new articles!

Want to feature in the next edition?