United States – In the USA, Sims Metal Management has sold its Arizona scrap metal recycling assets to SA Recycling LLC (SAR) – a joint venture owned equally by SimsMM and Adams Steel, with operations in California, Nevada and Arizona.
Concluded for US$ 35 million in cash, the sale principally involves the real property related assets for two scrap metal recycling facilities located in Phoenix and Tucson. SimsMM will retain the working capital assets of the Arizona business which is anticipated to monetise around a further US$ 15 million in cash over 45 days following the sale. This brings the total expected cash generation from the Arizona sale to US$ 50 million.
Daniel W. Dienst, Group Chief Executive Officer of SimsMM, states: ‘The sale of our Arizona assets, following on the heels of our recent dispositions of our Colorado assets, our joint venture interest in Nashville and the acquisitions of assets and businesses in Alabama and Maryland over the past few months, is part of our aggressive re-positioning of our shareholders’ precious capital to markets that offer the highest returns on invested capital and meet the long-term strategic growth plans we have for the important North American market.’
In addition, he says, the transaction ‘resolves issues related to the SAR joint venture agreement which granted Arizona as a territory to SAR, allowing us to operate, but to not otherwise expand in Arizona. We are pleased to have resolved this issue, while at the same time allowing our important joint venture partner in the south-western US to expand.’
George Adams, SAR’s Chief Executive Officer, comments: ‘The deal enables SAR to expand the reach of its Southern California base further into Arizona, and aligns our existing Arizona facility as a feeder yard to the shredder we acquired in this transaction. The transaction also allows the acquired facilities to realise freight efficiencies and better access to export markets through our docks in Southern California.’
For more information, visit: www.simsmm.com
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