Moving Metal

as a separate company. Ultimately the Phoenix operation became one of Arizona’s leading metals service centers. Gimbel had long hoped to make Reliance a powerhouse in the industry and had learned a valuable lesson from this transaction that helped him to achieve that goal. As Bob Henigson later stated, Gimbel “finally realized that it was a hell of a lot faster to grow a business by acquisition than it was through natural growth.” Thus began Reliance’s territo- rial expansion based on a simple formula: acquire existing service centers and then develop each into a leading regional company. The next acquisition came in 1961 with the purchase of the Santa Clara-based Westates Steel Company, which became Reliance’s first Northern California metals service center. The next opportunity appeared in 1963: Drake Steel Supply Company, a large, well-established competitor with facilities in Los Angeles, San Diego, and Fresno. This acquisi- tion was among the most important in the company’s history. It began much like the Effron deal, when Drake’s owners decided that they wanted to leave the business and gave Gimbel a call. Before committing to this larger purchase, however, Gimbel carefully analyzed Drake’s operations to ensure that the acquisition would be a good fit. Meanwhile, as Reliance began to expand by acquisi- tion it also built up its management ranks. The change was precipitated when Bernard Hiemenz, longtime Comptroller and Chairman of the Board of Directors, retired in early 1963. Jack Roe moved up to the chairmanship, but that would be temporary—he himself was planning to retire. Younger men rising in the ranks included Robert L. Zickerman, who took over as Comptroller and assistant to long-time Sec- retary-Treasurer Bettie Littell. Inside Sales and Warehouse

John H. “Johnny” Norris was Manager of Reliance San Diego operations. He was also, for a time, one of the company’s top employee shareholders.

month, the Board of Directors endorsed the plan and allo- cated $175,000 to carry it out. Gimbel returned to Arizona with Jack Roe. Along with Imler they began searching for a suitable site. Then, in August, Effron Steel Company, located at 929-931 East Jackson Street in Phoenix, went up for sale. Gimbel and Roe seized the opportunity and negotiated a deal to buy out the owners for the bargain price of $158,656. Reliance took over the facility in September, built an addition, and was soon showing a good profit. This Phoenix oper- ation became Reliance’s first division—a distinct business unit within the corporation but not organized or operated

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