Nucor Corporation: Analysis of Growth Strategies via Acquisitions

This report provides an in-depth analysis of Nucor Corporation's growth strategy, focusing on its use of acquisitions to expand its customer base, geographical coverage, and product line diversity. The report highlights key acquisitions made since 2000, including Auburn Steel Company, British Corus steel, Marion Steel, and Connecticut Steel Corp, and Verco, and examines how these acquisitions contributed to Nucor's market presence and technological innovation. The report also discusses the company's decentralized work culture, technological advancements, and its ability to thrive during economic downturns. The analysis emphasizes Nucor's success in integrating acquired companies and maintaining a competitive advantage through strategic acquisitions, particularly in the steel industry.

Running head: NUCOR CORPORATION: GROWTH BY ACQUISITIONS
NUCOR CORPORATION: GROWTH BY ACQUISITIONS
Name of the Student
Name of the University
Author note

1NUCOR CORPORATION: GROWTH BY ACQUISITIONS
Nucor Corporation is one of the biggest steel producers in the world. It was initially involved in
the nuclear and electronic instruments business in the 1960s. After incurring losses, they had
hired an engineer F.Kenneth Iverson. It was on his recommendation that the company had
switched to the business of steel joist, through the help of the company’s South Carolina based
Vulcraft Subsidiary. With his vision and innovative business approach, Nucor Corp. continued to
grow and had become the most successful steel company in the history of the United States.
Since 2000, the company had embarked on its strategy of acquisition for the expansion of
its customer base, geographical coverage and increasing the diversity of its product line. They
wanted to acquire growth driven companies. The Nucor management wanted to expand into new
territories by acquiring the existing plants of those areas (" Nucor Corporation | Our Story |
History ", 2018). Their existing equipments, customer’s base were used in accordance with
Nucor’s advantage. If required, the company had opted to build state of the art facilities in those
acquired firms in order to bring them to Nucor’s level. The economic recession of Asia had hit
the US in 2000-01 and the September 11; terrorist attacks had created a grim situation in the
overall steel market across the States and the world. Under the visionary leadership of Dan
DiMicco, (New CEO who took over in 2000) the management chose to use this grim scenario to
go ahead with their acquisition plans (Hwang, 2013). This was done primarily because of the
oversupplied steel industry and the excess number of economically plagued steel companies in
the US. Some of the path breaking acquisitions of Nucor is as follows:
Nucor in 2001 had acquired Auburn Steel Company which had provided a vast market presence
in the north east and a good source of supply for the new joist plant at Chemung. In June 2004,

2NUCOR CORPORATION: GROWTH BY ACQUISITIONS
Nucor acquired British Corus steel. It was the first US firm to produce high quality wide steel
plate produced from coiled steel plate. Nucor purchased in June 2005, Marion Steel, with an
annual capacity of 400,000 tons. Marion was also located in close proximity to over 60% of US
steel consumption. Nucor purchased Connecticut Steel Corp. in May 2006. The company’s
production of wire mesh and other structural fabrication strengthened Nucor’s current product
line up of steel bar products in a substantial way (" Nucor Corporation | Investor Relations ",
2018). The Verco acquisition in late 2006 had strengthened Vulcraft’s leading market position in
steel decking.
Nucor has been very successful in expanding its business horizons through acquisitions.
The company’s aggressive stance of technological innovation and pioneering approach towards
the use of modern technology in steel making has provided it unmatched results. Most
significantly, the introduction of Castrip in its Crawfordsville plant has been a major landmark in
its legacy. Nucor was the first company, to commercialise the castrip procedure. This had led to
a significant decrease in the cost of the operating. The company has always led the US steel
market by example. It is the only company which has remained unfazed by the downswings and
global recessions of the 2000s. The thirst of earning the rightful title of being the technological
leader in the steel business segment has made it a steel giant, which it is today.
Over the years, the steel giant had acquired new customer bases, steel markets, plants, innovative
technologies through its acquisitions which lead to a staggering 1757 million $ in 2006 from 310
million $ in 2000. One of the major reasons for the success through acquisition is Nucor’s
transformation of the acquired companies into a core part of Nucor’s family. The company
follows a highly decentralised work culture with greater amount of autonomy across its various
levels of management. It is a common norm for the Nucor’s veterans to visit newly acquired

3NUCOR CORPORATION: GROWTH BY ACQUISITIONS
plants in order to inquire that if those firms are worthy enough to be nurtured in the ‘Nucor’s
way ‘of doing things. Nucor’s technological innovation along with its contagious motivational
levels because of greater freedom is the reason for its success through acquisitions. Thus,
acquisition provides Nucor the most competitive advantage for expansion in the long run.

4NUCOR CORPORATION: GROWTH BY ACQUISITIONS
References:
Hwang, M. H. (2013). Globalization of steel industry (Doctoral dissertation).
Nucor Corporation | Our Story | History . (2018). Nucor.com. Retrieved 26 March 2018, from
http://www.nucor.com/story/chapter2/
Nucor Corporation | Investor Relations . (2018). Nucor.com. Retrieved 26 March 2018, from
http://www.nucor.com/investor/
(2018). Repository.upenn.edu. Retrieved 26 March 2018, from
https://repository.upenn.edu/cgi/viewcontent.cgi?article=1000&context=od_theses_msod