News Releases
Schnitzer Steel to Expand Its Eastern U.S. Metals Recycling Business
PORTLAND, Ore.--(BUSINESS WIRE)--Sept. 7, 2005--Schnitzer Steel
Industries, Inc. (NASDAQ:SCHN) ("Schnitzer" or "Company") announced
today that its wholly owned subsidiary, RRC Acquisition LLC ("RRC"),
signed a definitive agreement to buy substantially all of the assets
of Regional Recycling LLC ("Regional") for $65.5 million in cash and
the assumption of certain liabilities. Regional operates 10 metals
recycling facilities located in the states of Georgia (Atlanta (3),
Gainseville, Cartersville, Roosville and Bainbridge) and Alabama
(Birmingham, Attalla and Selma). The closing of the transaction is
subject to various conditions, including the expiration of the
Hart-Scott-Rodino Act waiting period and the approval of Schnitzer's
Board of Directors. The transaction is anticipated to close within the
next 60 days and will be funded from existing cash and borrowings
under the Company's bank line of credit.
Commenting on the agreement, John D. Carter, President and Chief
Executive Officer of Schnitzer, said, "We are very pleased to add the
Regional facilities and its employees to Schnitzer Steel. The Regional
acquisition is our initial step in growing the East Coast businesses
that we will receive upon closing of the separation agreement with
Hugo Neu Corporation. The Regional franchise is well situated to
continue to participate in the growing market for recycled metals in
the southeastern U.S., which is home to many new automobile and auto
parts manufacturers. During calendar 2004, Regional sold over 500,000
tons of ferrous metal and nearly 100 million pounds of non-ferrous
metal, which resulted in $190.4 million in revenue and a significant
operating margin. Regional sells its ferrous metal to domestic steel
mills in its area, of which there are 23 today. Its non-ferrous metal
is sold in both domestic and foreign markets."
Mr. Carter added, "Regional is led by its two excellent managers,
Byron Kopman and David Romanoff, who lead the growth of Regional
today. Upon closing of the transaction, both Byron and David will sign
employment agreements and join Schnitzer's executive management team
being responsible for operating and growing Regional's franchise. We
also anticipate hiring Regional's existing employees."
Schnitzer Steel Industries, Inc. is one of the nation's largest
recyclers of ferrous metals, a leading self-service used auto parts
retailer with 30 locations in the U.S. and Canada, and manufacturer of
finished steel products. The Company, with its joint venture partners,
processes approximately 5.4 million of recycled ferrous metals per
year and trades nearly 3.0 million tons. In addition, the Company's
steel mill has an annual production capacity of approximately 700,000
tons of finished steel products. Schnitzer and its joint venture
partners operate primarily along the U.S. West Coast and the
Northeastern seaboard of the U.S.
This news release contains forward-looking statements, within the
meaning of Section 21E of the Securities Exchange Act of 1934, which
are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. One can generally identify
these forward-looking statements because they contain "expect",
"believe", "anticipate", "estimate" and other words that convey a
similar meaning. One can also identify these statements, as they do
not relate strictly to historical or current facts. In particular,
this news release includes a statement that the Regional transaction
is anticipated to close within the next 60 days. These forward-looking
statements are subject to risks, uncertainties, and other factors that
could cause actual results to differ materially from future results
expressed or implied by the forward-looking statements. Important
factors that could cause actual results to differ materially from the
information set forth in these forward-looking statements include the
timing of satisfaction of the closing conditions for the transaction,
and other factors and events, some of which are discussed in the
Company's most recent annual report on Form 10-K and its most recent
quarterly report on Form 10-Q. One should understand that it is not
possible to predict or identify all factors that could cause actual
results to differ from the Company's forward-looking statements.
Consequently, the reader should not consider any such list to be a
complete statement of all potential risks or uncertainties. The
Company does not assume any obligation to update any forward-looking
statement.
CONTACT: Schnitzer Steel Industries, Inc.
Tom Zelenka, 503-323-2821 (Press Contact)
or
Kelly Lang, 503-224-9900 (Investor Relations)
www.schnitzersteel.com
SOURCE: Schnitzer Steel Industries, Inc.