BETHESDA, Md., June 29 /PRNewswire/ -- American Capital Strategies, Ltd. (Nasdaq:ACAS) today announced the purchase of $9.7 million in senior notes by Tube City Olympic of Ohio, Inc., a wholly-owned subsidiary of Tube City, Inc., in conjunction with a commitment to purchase an additional $6.8 million of subordinated notes issued by Tube City. The purchase and commitment total $16.5 million.
Tube City is a diversified steel mill service company with sales in excess of $470 million in 1998. The company provides scrap management and slag processing services under long-term contracts to mini-mills and integrated steel facilities throughout the United States. In addition, Tube City operates a scrap metal brokerage operation serving steel mills in the eastern United States. The American Capital financing will allow Tube City's Olympic Mill Services division (OMS) to provide services to a major US integrated steelmaker under a new long-term contract.
American Capital Associate David Ehrenfest Steinglass said, ``Tube City has done a phenomenal job in developing the OMS division. The company has assembled a top-notch management team and has aggressively grown the business over the last five years. We are pleased to support Tube City to set the stage for further expansion.''
CEO of Tube City I Michael Coslov commented, ``We have had a very positive experience partnering with American Capital. They have worked hard to come up with a flexible financing structure to meet our needs, and did so in a compressed time frame that enabled us to implement our business plan without missing a beat.''
Adam Blumenthal, Chief Operating Officer of American Capital noted, ``Tube City is our second steel industry portfolio company. We are seeing many investment opportunities brought about by the turbulent pricing environment for steel. We believe that companies that have invested to remain on the technological forefront of the industry will do well.''
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American Capital is a buyout and specialty finance company with capital resources exceeding $275 million. American Capital invests in senior debt, subordinated debt and equity in middle market companies in need of capital for growth, acquisitions, ESOP buyouts, management buyouts, liquidity and restructurings. Companies interested in learning more about American Capital and its unique and flexible financing should contact John Hoffmire, Vice President of Sales and Marketing, at (800) 248-9340 or visit its Web site at www.American-Capital.com or its shareholder site at www.ACASOnline.com.
