May 2006

 

Metalico acquires 22-acre property in New York

Cranford, NJ— Metalico, Inc. has agreed to purchase a 22-acre 108,000-square foot property located in DeWitt, New York. The purchase price was not disclosed.

The Company plans to open a new scrap processing facility to serve the Syracuse and Central New York market. The new facility will be operated by Metalico Syracuse, Inc., a subsidiary of the Company, and will provide ferrous and non-ferrous scrap handling services to existing industrial accounts, auto wreckers, dealers and peddlers of scrap metal, who will very soon have another outlet to sell their scrap to Metalico.

It will also serve as a key buying center for auto hulks and light iron expected to be transported to a shredder located near Rochester, New York.

The DeWitt property formerly housed an aluminum smelting plant operated by Wabash Aluminum Alloys, LLC. Metalico plans to conduct extensive aluminum processing activities at the site, including crushing, drying and smelting aluminum utilizing a reverb furnace technology to produce deoxidizing aluminum cones and shot which will be marketed to the steel-making industry. The Syracuse operation will be developed and operated under the leadership of Jon Marantz, who presently manages the Company’s aluminum smelting operations in Lackawanna, New York.

Metalico plans to relocate its existing Lackawanna de-ox production to DeWitt and to increase the production capacity gradually, to approximately six million pounds per month of finished product to further participate in the United States de-ox market which due to recent plant closures appears to be underserved. The average price of de-ox products sold in the marketplace during the last six month has ranged between $.80 and $1.10 per pound.

The Company expects to commence scrap operations in DeWitt during the second quarter and to ramp up aluminum smelting activity through the year, subject to the permitting process and completion of complementary construction on the site.

 


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