Sandy Nosler, president of Pacific Metal Co., Portland, Ore., formerly part of Metals USA's Specialty Metals product group and now a subsidiary of Reliance, believes that knowing the industry and the business is crucial to rollup success.
"Anybody who does their research would see there are cycles in this industry.If companies are trying to grow for revenues' sake, that's not the answer.The fact you are a $2 billion company rather than a $1 billion company won't necessarily bring you a whole lot of extra purchasing power.As you grow, you must make sure it means positive growth for earnings, not just revenues," Nosler
is happy for employees that Pacific Metal Co.
is now part of Reliance Steel & Aluminum Co.
"We were an employee-owned company [since 1984], and we had some tough losses on our retirement accounts."Pacific's ESOP, valued at $10 million in 1998, was rolled over into Metals USA common stock.
"To be with a financially strong organization like Reliance is a great fit for us.Culturally, it's a good fit.As long as you perform, they allow you to run pretty independently," says Nosler, Pacific's president.Pacific's
divestiture was a good decision for Metals USA
, too, because, "when you talk about synergies from consolidation, that part just didn't work."Pacific "was off the beaten track-about the only operation out West that they owned, so it was hard for them to get any synergies from us, or us from them, because of our distances from other facilities."
Founded in 1876 and Alcoa Inc.'s
oldest distributor, Pacific Metal
does not expect much to change under Reliance."Perhaps there are some strong relationships Reliance has that we can lean on, and maybe we'll do better with some vendors.We do want to grow our business and will look at avenues to do that," Nosler
One of the most gratifying changes is that Pacific will use its own name again in the marketplace.Nosler
says the value of the brand is immeasurable."The name is special to our employees.Our customers and suppliers still think of us as Pacific Metal.It's a good feeling."