STAINLESS EUROPE sells its majority stake in ALCO to the Italian CTA Group
The French company ALCO, based in Tournan-en-Brie in the Paris Région, offers a wide range of seamless stainless steel pipes and fittings of European origin including a range of conventional products intended for the Oil & Gas, Naval, Chemical, Petrochemical markets, and a qualified RCCM range for the Nuclear industry. ALCO has specialized since 1979 in the storage and supply of seamless stainless steel pipes and valves, carbon steels, alloys and special steels, the main products of which are tubes, seamless tubing and fittings, fittings, flanges, sheets, accessories, raw and cut sheets and machinated parts following drawings. ALCO holds a set of certifications and qualifications (RCC-M, RCCMX, RCCMR, STD, EN 9120) resulting from its efficient management and quality control system. The company is present as a qualified player on strategic and advanced technology markets, in particular the Nuclear, Aeronautics, Space, and Defense industry. The Italian group CTA S.P.A. (over €100m in revenue) is a worldwide market player supplying industrial piping projects in the carbon and stainless steels industry for more than 60 years. With its 30.000 tons of stainless, alloy and carbon steel pipes stock in its warehouses, its 200.000 tons yearly handled capability, CTA is considered one of the major international suppliers in this market. TAD LONG PRODUCTS (T.L.P. S.P.A.), is a 100% owned subsidiary of the CTA Group, specialized in the distribution of tubes with and without welding, fittings and bars, particularly in stainless steel for the Petroleum, Chemical and Petrochemical industries and Mechanical. As a result of an international operation subject to prior assessment of the French Ministry of Economics and Finance within the mechanism for the control and screening of foreign investments addressing strategic sectors in France (Foreign Direct Investment – FDI) STAINLESS EUROPE sells its majority stake in ALCO to T.L.P. S.P.A.
STAINLESS EUROPE sells its majority stake in ALCO to the Italian CTA Group (Sales > €100M) Industry sector: Seamless tube & fittings
Jean-Max Schneider, President of STAINLESS EUROPE, is convinced that this strategic operation will give ALCO and its team of passionate men and women “new means and significant resources to fulfill their ambition, their passion, consolidate their expertise recognized on the French market, and also ensure a long-term strategic vision ”.
We spoke to our member Guiseppe Sangiovanni regarding his role representing Linkers and what were the challenges faced in closing this substantial deal.
There were many challenges in this deal not least because it was during the pandemic but also with linguistic and logistical issues. The deal was overseen by an International Consortium of lawyers. Their business language was English while the sellers were French and the buyers were Italian. The challenges of Zoom meetings for highly sensitive negotiations in a foreign language can lead to misunderstandings which we could not afford and had to be handled very delicately.
Although in terms of deal size it wasn’t huge, the sheer amount of work involved to make it happen was equivalent to a much bigger deal, also the finalizing and Due diligence and negotiations with banks for an outstanding loan on the business made it very complex and involved a lot more work on our part requiring special efforts in terms of organization and authorizations as well as the use of IT tools such as qualified electronic signatures (SEQ) via the DocuSign platform. Another important step was the approval of the Ministry of Finance which has strict regulations about selling French companies to foreign investors. This involved a lot of paperwork and bureaucracy which also had to be closely adhered to. After much perseverance and hard work, we closed the deal and are very happy with the outcome. It showed that making deals is possible during these complicated times but that it creates more work and time management than we had originally thought.