Moving Metal

itself as one of the major distributors of steel and aluminum products in North America.” Metal Center News evoked a metallurgical allusion, using the term “alloyance” to describe the acquisition. “Like metals that are melded to create desir- able new alloys,” it declared, “the alliance of Reliance and EMJ creates a competitor with formidable strength.” The impact of the EMJ acquisition was immediately evident in Reliance’s 2006 second quarter earnings: sales jumped ninety-one percent to $1.56 billion. Reliance was on track for its biggest year yet. In August, barely three months after closing the EMJ deal, Reliance made another big purchase, acquiring Yarde Metals, Inc., based in Southington, Connecticut. Yarde’s net sales, which hit $385 million in June 2006, made it Reliance’s second largest acquisition in terms of revenue. The company was founded in 1976 by Craig Yarde. At first, Yarde operated out of his Bristol, Connecticut, basement and made deliveries in his station wagon while his three-year-old daughter Tracy answered the phone. In 1977 he partnered with his brother, Bruce. Within ten years their company had moved into a 40,000-square-foot facility, and had built a reputation for pro- cessing and distributing stainless steel and aluminum plate, rod, and bar products. In the 1990s the family-run company began expanding, setting up headquarters in Southing- ton and establishing branch locations in East Hanover, New Jersey; Limerick, Pennsylvania; and Streetsboro, Ohio. Yarde expanded further in the 2000s with new metals service centers in Pelham, New Hampshire; Hauppauge, New York; and High Point, North Carolina. By mid-decade, however, Yarde Metals was facing the challenge of how to transition the company beyond the founding generation. The problem was particularly acute

North American network of forty metals processing and distri- bution centers into the Reliance family, including key facilities in New England, the Midwest, and Canada. Sandy Nelson retired on the day that the acquisition took place and was succeeded by Neil McCaffery. It did not take McCaffery long to come to appreciate Reliance manage- ment. “It turns out that they were really smart,” he admitted. McCaffery remained EMJ’s President and CEO until 2011, when he retired and was succeeded by James Desmond. Jim Hoffman became EMJ’s Chief Operating Officer at the time of the acquisition. He was particularly excited about becoming a part of Reliance. “We really can’t control this,” he exclaimed, “but gosh, what a great outcome. If Reliance is going to buy us, then this is good.” Mollins appreciated having Hoffman as EMJ’s COO. “He and I clicked like this,” Mollins said, snapping his fingers. “That was the largest acquisition at the time and it was the easiest, literally, because EMJ had one culture.” In April 2008, on Mollins’ recommendation, the Reliance Board elevated Hoffman to Senior Vice President, Opera- tions, making him responsible for a number of subsidiaries, including EMJ. Reflecting on his experience since the acqui- sition, Hoffman stated, “I love the passion and simplicity that is Reliance. It’s a complex organization that has been run on some very core, very simple values, and it’s fun to be a part of it.” NEW FINANCIAL MUSCLE Reliance’s acquisition of EMJ sent shockwaves through the metals service center industry and drew even broader media attention. The Los Angeles Business Journal reported that in buying EMJ, Reliance “took a big step in solidifying

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