In a significant development for the refractory products industry, Resco Products, Inc. (“Resco”), currently under the umbrella of Balmoral Funds LLC (“Balmoral”), has announced a definitive agreement for its acquisition by RHI Magnesita (“RHIM”). The deal, valuing Resco at an enterprise value of up to $430 million, marks a pivotal step in the expansion and enhancement of refractory solutions on a global scale. RHI Magnesita, headquartered in Austria and listed on the London Stock Exchange, stands as a leading supplier renowned for its high-grade refractory products, systems, and solutions. These are indispensable for high-temperature processes across various industries such as steel, cement, non-ferrous metals, and glass.

The merger is poised to deliver substantial benefits to customers, notably through an expanded North American presence. The unified entity will boast 15 production sites scattered across the U.S., Canada, and Mexico. Additionally, the amalgamation of Resco and RHIM’s product portfolios—encompassing both basic and non-basic refractory solutions—promises a comprehensive range of options for clients. A key advantage of this acquisition is RHIM’s vertically integrated business model, which ensures a shorter, more resilient, and secure supply chain for Resco’s clientele.

Under the RHIM banner, Resco is set to gain access to increased resources for technology and innovation investment. This initiative aims to enhance Resco’s product offerings while advancing circular economy practices to support the refractory industry’s ambitious sustainability goals.

Mark G. Essig, CEO of Resco, highlighted the transaction as a milestone reflecting the company’s successful transformation, emphasizing safety, operational improvements, and customer growth. RHIM’s alignment with Resco’s core values, particularly in safety, quality, and innovation, was also noted as a critical factor in the merger decision.

Robin Nourmand, a Managing Director at Balmoral, commended the partnership with Resco’s leadership for significantly enhancing operational efficiencies, setting the stage for a fruitful integration with RHIM. The emphasis on the improvement in environmental, health, and safety culture as a lasting legacy was particularly underscored.

The transaction, expected to conclude in the second half of 2024, awaits customary closing conditions and regulatory nods. Jefferies LLC and Vedder Price were tapped as financial and legal advisors to Resco, respectively, underscoring the meticulous planning and strategic foresight guiding this acquisition.

The acquisition of Resco by RHI Magnesita represents a strategic alignment that not only broadens the refractory solutions landscape but also reinforces the commitment to sustainable manufacturing practices. This merger is anticipated to set new industry standards for efficiency, innovation, and environmental stewardship, ensuring that the refractory sector continues to meet the evolving demands of its global clientele.

  High-Temperature Industry Solutions, North American Expansion, Refractory Industry Merger, Refractory Products, Resco Products Inc, RHI Magnesita, sustainable manufacturing