More bad news......
By Rick Romell
of the Journal Sentinel staff
October 6, 1998
Depressed scrap prices have killed the planned purchase of Milwaukee Scrap Metal Co. by
Colorado-based Recycling Industries Inc., the second such deal to fall apart in a week.
Milwaukee Scrap owner Morry Mitz said Monday he had called off the planned purchase because
of unacceptable closing terms.
Recycling Industries chairman and chief executive officer Thomas J. Wiens said the scrap market
had worsened dramatically in the three months since the deal was announced, and that Recycling
Industries couldn't "make the current conditions match up to the terms."
Wiens' company has been seeking to consolidate the scrap business nationwide through an
aggressive acquisition strategy that uses a combination of cash and stock to buy independent scrap
yards.
But a flood of cheap foreign steel into the United States has helped push ferrous scrap prices to
20-year lows, and Recycling Industries' stock has suffered at the same time.
Trading at around $6 when the Milwaukee Scrap acquisition was announced in late June, the stock
closed Monday at $1.219.
Milwaukee Scrap, 1236 W. Pierce St., is a relatively small firm that processes non-ferrous metals
such as aluminum, brass, copper and stainless steel.
Last week, the planned purchase of a 34% stake in Miller Compressing Co., the area's largest scrap
processor, also was scuttled.
Miller Compressing had been sought by Chicago-based Metal Management Inc., another publicly
traded scrap-yard consolidator whose stock has been battered over the last year.
NH |
