Case Study: Atlas Steels Group
In November 2001 Quadrant backed a management buy in team led by Philip Cave in the acquisition of Atlas Steels Group (Atlas). Along with Philip as Chairman, Kym Godson was appointed as Managing Director (formerly MD of Atlas between 1990 & 1995).Atlas was the largest processor and distributor of stainless and specialty steels in Australia and New Zealand. Atlas Steels comprised 16 steel distribution centres throughout Australia and New Zealand, three distribution centres in South East Asia and three primary processing facilities in Australia.
Quadrant’s rationale for investment was as follows:
- Critical mass business with strong cash flow and brand recognition
- Leading market position in Australia and New Zealand - 20% market share in the distribution of stainless steel and engineering steel products and over 75% market share in the processing of quenched and tempered steel
- A distribution business that had a niche in adding value to a range of its products and had a significant pathway to over seven thousand customers
- A proven management buy in team - the Chief Executive had run the business seven years earlier and was aware of the potential of the business
Quadrant’s investment in Atlas was awarded the Best Management Buy-in by the Australian Venture Capital Association (AVCAL) in 2003 and CFO Magazine Private Equity Deal of the Year for 2003.
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