Murray snaps up fresh steel acquisition in £25m deal

SIR David Murray will continue to seek out opportunities to expand his £350 million metals business after snapping up a Somerset-based steel business which employs almost 100 people.

The acquisition of Newton Steel Stock comes hot on the heels of the purchase of Tipton & Mill Steel Limited and takes the headcount at Murray Metals Group to more than 850.

The value of the latest deal is understood to be around 25m. Newton Steel, which was founded in 1986, has an annual turnover of about 35m.

A spokesman for Murray said the Rangers chairman and his management team at Murray Metals would not be resting on their laurels.

"Murray Metals Group is growing rapidly," he said. "We will be looking for further opportunities to grow the steel business, and seeking businesses with strong management teams that fit in with our model.

"Scale is important as is delivering the right products within our markets," he added.

The expansion of the metals business comes amid rising steel prices and industry consolidation, with recent tie-ups between Mittal Steel and Arcelor, and Tata and Corus, tightening the metal supply chain.

At the tail end of 2005, Murray sold his Murray International Metals arm for more than 110m to US private equity group Jefferies Capital Partners, describing the offer as too good to refuse. However, the surprise move has allowed the group to bolster its other metals operations through a string of acquisitions.

Murray Metals forms part of a sprawling business empire that also includes call centres, property investment and Rangers Football Club. Recently-filed accounts for Murray International Holdings, which is majority owned and controlled by the eponymous Scots business tycoon, revealed that annual revenues had risen 40 per cent to 538m, helping to treble operating profits to 15.4m.

Commenting on yesterday's acquisition, David Lawson, director of the Murray General Steels subsidiary, said: "Newton Steel Stock is a respected and well run business with a strong management team and customer base.

"This is an important acquisition for Murray General Steels: we are growing and we have a clear strategic plan to continue our development."

Graeme Hill, chief executive of Murray Metals, added: "This is yet another significant acquisition and one that will increase our service capacity and our geographical reach.

"It is important, in a mature market, to ensure that you can offer customers a broad mix of competitively priced, high-end quality products, excellence in customer service and the ability to deliver quickly and effectively from a spread of geographic locations."