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IMCO Recycling Arranges New Credit Facilities and Completes Acquisitions of IMSAMET and Rock Creek.

IRVING, Texas--(BUSINESS WIRE)--Jan. 22, 1997--IMCO Recycling Inc. (NYSE:IMR) today announced that it has arranged $125 million in senior secured credit facilities consisting of a $105 million term loan and a $20 million revolving credit agreement.

Funds from the term loan have been used to complete IMCO's previously announced plan to acquire IMSAMET, a wholly owned subsidiary of Envirosource, Inc. (NASDAQ:ENSO), for a total cash price of $58 million.

IMSAMET owns or has a majority interest in three aluminum recycling plants in Arizona, Idaho and Utah which together have an annual processing capacity of 400 million pounds. It also has a 50 percent interest in a joint venture facility adjacent to the Utah plant which uses a patented process to reclaim materials from salt cake, a by-product of aluminum recycling.

Following the acquisition of IMSAMET, IMCO's effective annual processing capacity will rise to 2.2 billion pounds, 36 percent above the prior year level.

The company also has completed its previously announced plan to acquire Rock Creek Aluminum, Inc., a privately owned manufacturer of aluminum products for the steel industry.

The purchase price for Rock Creek Aluminum was $9.5 million paid in new IMCO Recycling common shares that were issued in a privately negotiated transaction. In addition, IMCO assumed approximately $1.75 million in long-term debt of Rock Creek Aluminum.

Rock Creek Aluminum, which has annual revenues of about $50 million, operates three production facilities in Cleveland, Elyria and Rock Creek, Ohio that mechanically process aluminum dross and scrap. Its products are used to deoxidize steel and as key ingredients in desulphurizers and slag conditioners.

The three Rock Creek plants have an annual input capacity of 150 million pounds. In addition, since 1993 the company has provided scrap to IMCO's Uhrichsville, Ohio plant which manufactures deoxidizing products on a tolling basis. Rock Creek then sells these products to steelmakers.

Frank H. Romanelli, IMCO's president and chief executive officer, said the IMSAMET and Rock Creek acquisitions "represent a continuation of our strategy to increase capacity, broaden the geographic and end-use markets we serve and expand our customer base."

Romanelli said that, in addition to funding of the IMSAMET acquisition, IMCO's new term loan was used to refinance existing indebtedness. The revolving credit agreement will provide for ongoing working capital needs.

After completing these transactions, IMCO's total outstanding debt is $117.4 million, including $7.3 million in solid waste disposal revenue bonds and other long-term debt and $5.1 million in borrowings under the revolving credit agreement.

IMCO's debt as a percent of total capital is now in the 50 percent range. Romanelli said the company will reduce its total debt and debt- equity ratio in 1997 through quarterly amortization payments on the term loan and other debt payments.

The term loan has a final maturity of seven years and the revolving credit agreement has a final maturity of five years.

Merrill Lynch & Co. served as arranger and syndication agent for IMCO's new credit facilities.

IMCO Recycling Inc. is the world's largest aluminum recycler and also processes zinc and magnesium. The company has 16 U.S. production facilities and owns 50 percent of a joint venture that operates two recycling and foundry alloy plants in Germany. IMCO Recycling's headquarters office is in Irving, Texas.

This news release contains certain information which may be deemed to be forward-looking. These statements are based on current expectations and involve a number of risks and uncertainties. Actual results could differ materially from those described in the forward-looking statements as a result of various factors including, but not limited to, the following: business conditions and growth in the aluminum and aluminum recycling industries as well as the general economy; the price of aluminum on world and U.S. markets; fluctuations in customer demand and the price for the company's services and metal; the retention of major customers; changes in the many factors affecting the company's revenues and costs including energy costs and weather conditions; the future mix of buy/sell vs. tolling business; operating levels of the company's various facilities; and other risk factors listed form time to time in the company's Securities and Exchange Commission reports, including but not limited to the report on Form 10Q for Sept. 30, 1996, particularly the Cautionary Statement For Purposes Of Forward-Looking Statements.

CONTACT: IMCO Recycling, Inc.

Paul V. Dufour, 972/869-6575
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Publication:Business Wire
Date:Jan 22, 1997
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