Carlyle sells steelmaker

The alternative asset titan has sold its majority stake in JMC Steel Group to minority shareholder Zekelman family.

Global private equity giant The Carlyle Group has partially exited its investment in steel pipe and tube manufacturer John Maneely Company (JMC). The group agreed to sell its majority stake to the Zekelman family, which presently owns a minority stake.

JMC: an exit still in the
pipeline for Carlyle 

Financial details were not disclosed.

New Jersey-based JMC will rework its capital structure following the deal, borrowing roughly $1.1 billion in debt to retire the company’s existing debt and facilitate the transaction.

Under the agreement, Carlyle will continue its presence on JMC’s board of directors whilst preserving a minority stake in the company.

“Our new ownership and accompanying changes in financial structure will give JMC much more flexibility to make strategic investments,” said JMC chairman Barry Zekelman in a statement.

The deal comes two years after Russian steel producer Novolipetsk Steel (or NLMK) paid a $234 million settlement for pulling out of a $3.53 billion deal with Carlyle to acquire JMC in late 2008.

Carlyle acquired JMC in 2006 for roughly $500 million, investing from its $7.85 billion buyout vehicle Carlyle Partners IV. That same year, the Washington DC-based firm merged JMC with Ontario, Canada-based steel tube specialist Atlas Tube in a deal valued at approximately $1.5 billion.

“Working closely with the Zekelmans and management we have made JMC a stronger company economically and from an environmental and governance standpoint,” said Carlyle managing director Andrew Marino in a statement.