Nucor ties into another downstream market

Nucor Corp. has acquired Southwest Data Products Inc. (SWDP), a manufacturer and installer of data center infrastructure.

The Charlotte, North Carolina-based steel production and recycling company purchased SWDP, which is based in San Bernardino, California, for $115 million.

Nucor also plans to announce the launch of Nucor Data Systems, a new business unit it says will help better serve its customers in the data center infrastructure industry.

Nucor, in addition to operating a network of scrap yards and producing direct-reduced iron (DRI) upstream of its electric arc furnace (EAF) steel mill network, regularly has been adding to its downstream network of business units that consume finished steel.

“We are excited to add SWDP and new teammates to our Nucor family of companies,” says Chad Utermark, executive vice president at Nucor. “This acquisition will give us new capabilities to serve a rapidly growing market and will bolster Nucor as a preferred supplier to many of the nation's largest and most innovative hyperscale cloud and colocation data center operators.

“The SWDP acquisition furthers our expand-beyond strategy to invest in steel-centric businesses that operate outside of the cyclical nature of steel production.”

The new assets will provide Nucor's Warehouse Systems businesses with expanded capabilities in airflow containment structures, as well as new product capabilities that include manufacturing cabinets, enclosures and caging for data centers and installation services.

“SWDP’s compatibility with Nucor Warehouse Systems’ current manufacturing capabilities will create significant growth opportunities, and SWDP’s location near Nucor Warehouse Systems’ production facility in Southern California will facilitate both integration and growth efforts,” Nucor adds.

SWDP and the new Nucor Data Systems will use many types of steel as raw material that can be provided by Nucor facilities, including sheet steel, steel tubing and wire mesh.

“With our circular, recycling-based steel production process, sourcing steel from Nucor mills will ensure our nation’s green and digital economy is being built with low-embodied carbon steel,” Nucor says.