RHI Magnesita Completes Major Acquisition of Resco Group to Strengthen North American Footprint
RHI Magnesita, the global leader in refractory products, systems, and solutions, has finalized its acquisition of the US-based Resco Group, a key player in the refractory industry, from Balmoral Funds LLC. The deal, valued at $410 million, is the most significant investment by RHI Magnesita since the merger between RHI and Magnesita in 2017.
This strategic acquisition represents a major step in RHI Magnesita’s growth in the North American market, a region critical for the company’s global operations. Refractory products are essential in various industries, including cement, steel, aluminium, and petrochemicals. By adding Resco Group to its portfolio, RHI Magnesita aims to significantly enhance its ability to serve these key sectors, improve its local manufacturing capabilities, and solidify its position in North America.
Strengthening North American Operations
The acquisition of Resco Group will lead to several key improvements in RHI Magnesita’s North American operations, with the primary focus being on improving the local-for-local production model. This strategic shift will reduce the reliance on international imports, enhancing supply chain security for critical industries. The move will also provide better logistical efficiencies, reducing lead times and ensuring that customers receive products in a more timely and efficient manner.
As part of the acquisition, RHI Magnesita will now offer a broader product portfolio, adding a wider range of both basic and non-basic refractory products. Resco Group’s strength in alumina-based refractories will also complement RHI Magnesita’s strategic focus on growing this segment, particularly in North America.
Enhancing Customer Experience and Sustainability
With this acquisition, RHI Magnesita is committed to improving the customer experience by offering an even broader array of high-quality products. The expanded product range will cater to industries across the board, from steel and cement to aluminium and petrochemicals. The integration of Resco’s capabilities will allow RHI Magnesita to offer innovative solutions that meet evolving customer demands.
RHI Magnesita is also reinforcing its dedication to sustainability. The company’s leadership in innovation and sustainability, especially through circular economy solutions, will provide Resco’s customers with access to advanced recycling initiatives. This is crucial in supporting broader industrial decarbonization efforts and reducing waste by transforming used refractory materials into reusable raw materials. As environmental standards become increasingly stringent, these sustainability advancements will set RHI Magnesita apart in the market.
Strategic Integration and Future Investments
The integration of Resco Group into RHI Magnesita will not only include combining the companies’ teams and technologies but also a significant investment in upgrading Resco’s plants. These upgrades will enhance production capacities, introduce new product lines, and improve overall productivity, positioning the company for future growth.
Stefan Borgas, the CEO of RHI Magnesita, commented on the acquisition, calling it a “significant milestone” for the company’s North American business. He highlighted that Resco’s customer base, particularly in the petrochemical, cement, and aluminium industries, would immediately add value to RHI Magnesita. Borgas also welcomed the employees of Resco to RHI Magnesita, noting that the company’s people are its greatest asset and that the collaboration will lead to the setting of new industry standards.
Mark Essig, the CEO of Resco until the sale, expressed excitement about the new chapter for Resco. He emphasized that joining forces with RHI Magnesita would allow Resco to expand its reach, enhance its capabilities, and continue delivering excellent customer service. Essig also acknowledged the crucial support from Balmoral Funds, which helped strengthen Resco’s market position over the years.
The Road Ahead
In the coming months, RHI Magnesita will continue its focus on the integration process to ensure a smooth transition for employees, customers, and suppliers. The goal is to combine the best aspects of both companies to drive future growth and market leadership. The acquisition of Resco Group not only positions RHI Magnesita as a stronger player in North America but also enables the company to better serve its customers and meet the demands of the global refractory industry.
With a stronger foothold in the North American market, RHI Magnesita is set to make a significant impact in the refractory products and solutions sector, providing value through innovation, local production, and sustainable practices. The acquisition underscores the company's long-term commitment to delivering exceptional customer experiences and setting the highest standards in the industry.
