Ventures Metals acquisition now finalized

Industrial Services of America, Inc., (ISA) said the company completed the purchase of stainless steel and high temperature metals inventories from Ventures Metals, LLC, and agreed to lease Venture Metals’ processing equipment and facilities.

ISA announced January 20 it would enter the stainless steel and high-temperature metals recycling business through the purchase of Venture Metals’ inventories and through access to processing sites leased at Campground Road in Louisville and in Mobile, Alabama.

The agreement provides ISA the option under certain conditions to buy Venture Metals’ fixed assets and equipment such as cranes, forklifts, loaders, and scales, for approximately $1.5 million.

The transaction was funded through a $12 million Branch Banking and Trust Company non-revolving funding facility. As previously reported, ISA has contracts to market a substantial amount of the purchased stainless steel scrap inventory during the first quarter of fiscal 2009.

In addition to the transactions with Venture Metals and the related loan, ISA concluded the settlement of a suit filed by All American Recycling (AAR), which has returned control to ISA of a recycling retail operation. On February 9, ISA paid AAR approximately $990,000, which was reserved as of December 31, 2008, and certain other transaction and legal costs to settle a breach of agreement claim.

As of March 31, ISA also regained access to several acres of property and facilities as part of the settlement to develop its shredder operations and to relocate its stainless operations to Grade Lane. ISA plans to renovate the Campground facility that is primarily a stainless yard at this time into a full-service yard that will feed ferrous, nonferrous and stainless material into the Grade Lane operations.