Transactions with Affiliated Companies

12 Months Ended

Dec. 31, 2012

Transactions with Affiliated Companies

Transactions with Affiliated Companies

Note 9. Transactions with Affiliated Companies

        The company sells flat rolled products and occasionally purchases ferrous materials from Heidtman. The president and chief executive officer of Heidtman is a member of the company's board of directors and a stockholder of the company. Transactions with Heidtman for the years ended December 31, are as follows (in thousands):

	2012			2011			2010
Sales	$	244,531		$	242,300		$	202,897
Percentage of consolidated net sales		3	%		3	%		3	%
Accounts receivable		38,093			35,646			31,544
Purchases		11,372			18,998			18,275
Accounts payable		800			882			969

        On September 15, 2009, the company purchased from Heidtman a 32 acre tract of land adjacent to the company's Flat Roll Division in Butler, Indiana, together with a 387,000 square foot building for a purchase price of $9.3 million. Contemporaneously the company purchased from Heidtman equipment located at this site for a purchase price of $18.6 million. Immediately following the acquisition of this property, the company leased the real estate and equipment to Heidtman for a term of five years commencing on September 15, 2009, and terminating on August 31, 2014, at which time Heidtman has the option to repurchase the real estate and equipment for $27.9 million. Heidtman pays the company monthly rental of approximately $289,000 for the real estate and for the equipment. The real estate and equipment have been used, and will continue to be used, by Heidtman in its steel processing operations.

        The company also purchases and sells recycled and scrap metal with other smaller affiliated companies. These transactions are as follows (in thousands):

	2012		2011		2010
Sales	$	38,286	$	36,486	$	37,057
Accounts receivable		4,771		7,247		6,577
Purchases		238,114		239,395		177,166
Accounts payable		14,344		5,702		12,601