Acquisitions	12 Months Ended
Dec. 31, 2020
Acquisitions
Acquisitions	Note 2. Acquisitions Zimmer On August 3, 2020, the company acquired 100% of Zimmer for cash consideration of $59.0 million, plus a customary working capital transaction purchase price adjustment of $1.0 million in the fourth quarter 2020. A portion of the consideration was used to pay off all existing borrowings of Zimmer in accordance with the purchase agreement. The transaction was funded with available cash. The acquisition of Zimmer is part of the company’s raw material procurement strategy to support its new Southwest-Sinton Flat Roll Division, which is planned to begin operations mid-year 2021. Headquartered in Monterrey, Mexico, Zimmer operates several ferrous and nonferrous scrap facilities strategically positioned near high-volume industrial scrap sources, and several third-party scrap processing locations, located throughout Central and Northern Mexico. Zimmer’s operating results from and after August 3, 2020, are reflected in the company’s financial statements in the metals recycling operations segment. The aggregate purchase price was allocated to the opening balance sheet of Zimmer as of the August 3, 2020, acquisition date based on the company’s valuation of the fair value of the acquired assets and assumed liabilities; $31.9 million of current and noncurrent assets, net of cash acquired, $18.3 million of property, plant and equipment, $25.7 million of intangible assets, $7.7 million of goodwill; and liabilities assumed of $23.6 million. The fair values of inventory were determined on the market approach, property, plant and equipment on the cost approach and identifiable intangible assets on the income approach (vendor relationships using an incremental income with or without valuation method, and customer relationships using the multi-period excess earnings method). The company utilized a third party valuation firm to assist in the determination of fair value of vendor relationships and customer relationships. The company has determined that nonrecurring fair value measurements related to certain assets acquired rely primarily on company-specific inputs and the company’s assumptions about the use of the assets, as observable inputs, which are not available, and as such, reside within Level 3 as provided for under ASC 820. Goodwill recognized from the acquisition primarily relates to the expected contributions of Zimmer to the overall company strategy in addition to the acquired workforce, which is not separable from goodwill. The goodwill is not deductible for tax purposes. The identifiable intangible assets related to the acquisition consisted of vendor relationships and customer relationships, each with estimated useful lives of 15 years. United Steel Supply On March 1, 2019, the company purchased 75% of the equity interest of United Steel Supply, LLC (USS) for cash consideration of $93.4 million, plus a customary working capital transaction purchase price adjustment of $3.7 million, which was paid in September 2019. Additionally, the company has an option to purchase, after the third anniversary of the transaction, and the sellers have the option to require the company to purchase after the third anniversary of the transaction, the remaining 25% equity interest of USS, which is therefore reflected in redeemable noncontrolling interest in the consolidated balance sheet. Headquartered in Austin, Texas, USS is a leading distributor of painted Galvalume® flat roll steel used for roofing and siding applications, with distribution centers strategically located in Mississippi, Indiana, Arkansas, and Oregon. USS provides the steel operations segment a new, complementary distribution channel and connects it to a rapidly growing industry segment with customers that do not traditionally purchase steel directly from a steel producer. USS’s post-acquisition operating results are reflected in the company’s financial statements in the steel operations segment. Heartland On June 29, 2018, the company completed its acquisition of 100% of Heartland Steel Processing, LLC (formerly known as Companhia Siderurgica Nacional, LLC) (Heartland), for an initial cash purchase price of $396.4 million, plus a customary working capital transaction purchase price adjustment of $37.6 million, which was paid in September 2018. Located in Terre Haute, Indiana, Heartland produces various types of higher-margin, flat roll steel by further processing hot roll coils into pickle and oil, cold roll, and galvanized products. The acquisition expanded the company’s annual flat roll steel shipping capacity of lighter-gauge and greater width flat roll steel offerings that broadens and diversifies the company’s value-added product portfolio and provides operational and logistics benefits to other nearby operations. Heartland’s post-acquisition operating results are reflected in the company’s financial statements in the steel operations segment.

Acquisitions

12 Months Ended

Dec. 31, 2020

Note 2. Acquisitions

Zimmer

On August 3, 2020, the company acquired 100% of Zimmer for cash consideration of $59.0 million, plus a customary working capital transaction purchase price adjustment of $1.0 million in the fourth quarter 2020. A portion of the consideration was used to pay off all existing borrowings of Zimmer in accordance with the purchase agreement. The transaction was funded with available cash. The acquisition of Zimmer is part of the company’s raw material procurement strategy to support its new Southwest-Sinton Flat Roll Division, which is planned to begin operations mid-year 2021. Headquartered in Monterrey, Mexico, Zimmer operates several ferrous and nonferrous scrap facilities strategically positioned near high-volume industrial scrap sources, and several third-party scrap processing locations, located throughout Central and Northern Mexico. Zimmer’s operating results from and after August 3, 2020, are reflected in the company’s financial statements in the metals recycling operations segment. The aggregate purchase price was allocated to the opening balance sheet of Zimmer as of the August 3, 2020, acquisition date based on the company’s valuation of the fair value of the acquired assets and assumed liabilities; $31.9 million of current and noncurrent assets, net of cash acquired, $18.3 million of property, plant and equipment, $25.7 million of intangible assets, $7.7 million of goodwill; and liabilities assumed of $23.6 million.

The fair values of inventory were determined on the market approach, property, plant and equipment on the cost approach and identifiable intangible assets on the income approach (vendor relationships using an incremental income with or without valuation method, and customer relationships using the multi-period excess earnings method). The company utilized a third party valuation firm to assist in the determination of fair value of vendor relationships and customer relationships. The company has determined that nonrecurring fair value measurements related to certain assets acquired rely primarily on company-specific inputs and the company’s assumptions about the use of the assets, as observable inputs, which are not available, and as such, reside within Level 3 as provided for under ASC 820. Goodwill recognized from the acquisition primarily relates to the expected contributions of Zimmer to the overall company strategy in addition to the acquired workforce, which is not separable from goodwill. The goodwill is not deductible for tax purposes. The identifiable intangible assets related to the acquisition consisted of vendor relationships and customer relationships, each with estimated useful lives of 15 years.

United Steel Supply

On March 1, 2019, the company purchased 75% of the equity interest of United Steel Supply, LLC (USS) for cash consideration of $93.4 million, plus a customary working capital transaction purchase price adjustment of $3.7 million, which was paid in September 2019. Additionally, the company has an option to purchase, after the third anniversary of the transaction, and the sellers have the option to require the company to purchase after the third anniversary of the transaction, the remaining 25% equity interest of USS, which is therefore reflected in redeemable noncontrolling interest in the consolidated balance sheet. Headquartered in Austin, Texas, USS is a leading distributor of painted Galvalume® flat roll steel used for roofing and siding applications, with distribution centers strategically located in Mississippi, Indiana, Arkansas, and Oregon. USS provides the steel operations segment a new, complementary distribution channel and connects it to a rapidly growing industry segment with customers that do not traditionally purchase steel directly from a steel producer. USS’s post-acquisition operating results are reflected in the company’s financial statements in the steel operations segment.

Heartland

On June 29, 2018, the company completed its acquisition of 100% of Heartland Steel Processing, LLC (formerly known as Companhia Siderurgica Nacional, LLC) (Heartland), for an initial cash purchase price of $396.4 million, plus a customary working capital transaction purchase price adjustment of $37.6 million, which was paid in September 2018. Located in Terre Haute, Indiana, Heartland produces various types of higher-margin, flat roll steel by further processing hot roll coils into pickle and oil, cold roll, and galvanized products. The acquisition expanded the company’s annual flat roll steel shipping capacity of lighter-gauge and greater width flat roll steel offerings that broadens and diversifies the company’s value-added product portfolio and provides operational and logistics benefits to other nearby operations. Heartland’s post-acquisition operating results are reflected in the company’s financial statements in the steel operations segment.