FoundryBlog

East Jordan Iron Works (the name) to Disappear

2011-12-22T18:16:00.002-05:00

Beginning January 6, 2012, the East Jordan Iron Works name will disappear and the company will be know as EJ. One of the best known names in municipal castings will no longer exist - however, nothing else is changing. EJ employs about 1,000 people in the U.S. and 2,000 in the companies they have acquired outside the U.S. Management was concerned that the "Jordan" part of the name was confusing to customers, hence the change. EJ is expected to be country neutral.

MTI Expanding Auburn Plant

2011-12-22T18:06:00.002-05:00

Metal Technologies will be investing $35 million to expand its Auburn, Indiana plant. Details of the expansion were not released. When completed in 2013, it is expected to add 42 jobs to the current roster of about 200.

Pacific Steel Casting Loses 200 Employees

2011-12-22T17:53:00.002-05:00

In February of this year, the Immigration and Customs Authority (ICE) requested Pacific Steel Casting for verification of I-9 documents for all 600 employees verifying eligibility for employment. The search identified 200 employees, some with 20 and 30 years service, who did not have valid social security numbers. After providing a grace period to correct errors, Pacific Steel terminated employment of all 200. This comes at a time when business is increasing and the company is adding employees as fast as they can.

Blue Point Acquires Selmet

2011-11-17T16:15:00.003-05:00

Blue Point Capital Partners, Cleveland, Ohio, has acquired Selmet Inc., Albany, Oregon. Selmet is a specialty manufacturer of titanium castings. Selmet has about 20o employees. Blue Point is not a novice in the metal casting industry. A prior investment was in Consolidated Foundries, a California based metal caster.

Grede Acquires Paxton-Mitchell

2011-11-03T13:05:00.001-05:00

Grede Holdings LLC, Southfield, Mich., has completed the acquisition of the foundry and machining assets of Paxton-Mitchell Corp., an industrial foundry and machining facility in Omaha, Neb. The facility will be called Grede Omaha LLC and, according to a Grede news release, it "strengthens Grede’s position in the heavy truck and industrial markets." The facility currently employs 75 people and is expected to expand in 2012 as additional business is transferred into Omaha from other Grede foundries, says the company. "This latest acquisition represents Grede’s commitment to the industrial and heavy truck iron casting market," says Doug Grimm, chairman, president and CEO of Grede Holdings. "We have focused on diversifying our business model to weather cyclicality, and now 60 percent of our revenues are derived from non-automotive customers." Grede Holdings LLC was formed in 2010 through the combination of assets of the former Grede Foundries Inc., Blackhawk Foundry (USA) and Citation Corp. The company specializes in ductile, gray and specialty iron castings and operates 16 foundries and four machining plants with 5,000 employees in North America. The company consumes as much as 25,000 tons of ferrous scrap each month, according to a feature article profiling Grede in the April 2010 edition of Recycling Today.

Source: Recyling Today, November 3, 2011

Chinese Come to Canada

2011-09-13T12:52:00.002-05:00

Chinese conglomerate Sichuan Bohong Industry Co., Ltd., has entered into an agreement to purchase Wescast Industries, Inc., Brantford, Ontario, Canada for C$13.60 a share. This puts the purchase price at abut $183 million. Wecast reported earnings of C$280,000 on C$143 million in sales for the first six months ending June 30, 2011. EBIT was C$2.174 million and EBITDA was C$7.207 million for the same period. For the purchase price, Sichuan is acquiring a company with a net worth of C$220.7 million. Sichuan has sales of about US$626 million and employs 2,300 people. Sichuan has a foundry division that produces automotive parts similar to Wescast.

India Iron to Get More Expensive

2011-08-29T09:25:00.002-05:00

The Supreme Court of India extended the ban on iron ore mining imposed in Karnataka's Ballary district to Tumkur and Chitradurga districts on Friday, August 26, 2011. The mines are closed pending satisfactory resolution of environmental concerns. The expected increase in ore and scrap costs is about 10% but availability is of an even greater concern. This is good news for U.S foundries that compete against ferrous based imported castings from India. Many of the imports are low end street castings. Look not only for price increases but availability issues as Indian foundries find getting scrap and pig iron more difficult. Steel manufacturer's in India have reported closing two mills due to shortages with the remaining mills operating at 40%. Kirloskar Ferrous Industries, Ltd., which produces 50,000 tonnes of gray iron castings a year reported being down to an 8 day inventory.

Westwood Aluminum Castings to Close

2011-08-18T16:10:00.002-05:00

Westwood Aluminum Castings, Waukesha, Wisconsin, is laying off 87 employees and closing. The company operates out of 200,000 square feet where they make large aluminum castings.

Do You Use a Temp Agency?

2011-08-01T09:23:00.002-05:00

It is not uncommon for metal casters to use a temp agency for probationary employment or for short term staffing requirements. In probationary employment, often for 60 or 90 days, satisfactory employees are added to the permanent staff or they are returned to the staffing agency. The staffing agency is responsible for paying all employment taxes while the individual is in their employ. However, if they do not, you are responsible for the taxes. We are aware of at least two cases where the staffing agency kept the funds they were paid and allocated for taxes and the foundry was required to pay the taxes a second time. This leaves the foundry in the position of suing the staffing agency to recover the tax payments. The most recent is Columbus Steel Castings suing Real Time Staffing Services to recover $779,230 that was paid to Real Time but not paid to the Ohio Bureau of Workers Compensation. Columbus was required to pay BWC directly. The moral - if you use temp agencies, make sure they are paying the taxes as required.

Etowah to Reopen - and Expand

2011-07-29T10:05:00.002-05:00

ThyssenKrupp Waupaca has announced they will reopen their foundry in Etowah, Tennessee. Hiring of 250 employees will begin in August with an anticipated start of operations in the first quarter of 2012. The foundry closed in January, 2010 due to the downturn in the automotive industry. Not only are the reopening the foundry but are investing in their melt, core and mill room equipment. Production will start with gray iron brake rotors and drums. Ductile iron production is projected to start in the second quarter of 2012.

Columbus Steel Castings to Pay Fine

2011-07-25T12:18:00.002-05:00

Columbus Steel Castings, Columbus, Ohio, has agreed to plead guilty to six air pollution violations. Columbus agreed to pay fines of $660,000 and pay a community service payment o f$165,000. The original total of the fines was $3 million.

Quaker City Castings Adds Elbow Room

2011-07-22T09:47:00.002-05:00

Quaker City Castings, Salem, Ohio, recently acquired 51,000 square feet of adjoining industrial space. The company plans to use the space for sand reclamation, expand various casting processing operations and additional room for quality control. Quaker City produces iron and steel castings up to 1,600 pounds and has a centrifugal casting operation that produces ring products and cylinder liners.

Akron Foundry a Total Loss

2011-07-18T09:23:00.001-05:00

Akron Foundry, 502 Main St., Akron, Indiana suffered a major fire on Friday, July 15, 2011, that is reported to have totally destroyed the business. Akron Foundry is an iron foundry with about 50 employees.

Premier Tool & Die Reopening Closed ICG CastingsPlant

2011-07-12T15:18:00.002-05:00

Premier Tool & Die, Berrien Springs, MI is acquiring the closed ICG Castings plant in Dowegiac, MI and reopening it to expand their die casting capabilities. The $3.2 million expansion should start operating the first quarter of next year. Evironmental clean-up will be funded by Premier and grants. Premier entered Dowegiac a year and a half ago when they opened a machining facility across the street from the ICG plant. That facility now employs 75 people. The growth is being supported by the Michigan Economic Development Authority.

That was Fast

2011-07-07T09:45:00.002-05:00

It was announced on July 6 that Castle Harlan acquired Norcast Wear Solutions for $190 million. On July 7, 2011, it was announced that Castle Harlan sold Norcast Wear Parts to Braken Ltd, Australia for $A202 or about $217 million, U.S. dollars. A 14% return on their investment for one or two days time.

Castle Harlan is Back in the Foundry Business

2011-07-07T08:44:00.002-05:00

The Financial Times announced on July 6, 2011, that Castle Harlan, New York, New York, has agreed to acquire Norcast Wear Solutions from Palin Investments for $190 million. Norcast is a leading producer of wear parts for mining and mineral processing with foundries in Canada and Malaysia. Castle Harlan had previously owned Americast, a leading U.S. steel foundry group before selling it to Bradken, Ltd., in 2008.

Dynacast to be Sold

2011-06-14T10:24:00.002-05:00

A press release indicated that Melrose, plc, has entered into an agreement with Kenner & Co. to sell Dynacast for $590 million. The sale should be complete by August. Sales at the 21 Dynacast worldwide locations in 2010 were about $2.26 billion with net income of about $255 million. Melrose acquired Dynacast in 2005 from Cinven for $70 million. The $590 million selling price is 2.3 times the 2010 net income.

Business Must be Good at Signicast

2011-05-19T17:18:00.003-05:00

Signicast, an investment casting company located in Hartford, Wisconsin, is contemplating a major expansion according to local news sources. The expansion would be 576,000 square feet and employ an additional 500 people over the next 10 to 15 years.

Esco Going Public

2011-05-19T17:12:00.002-05:00

Ninety eight year old Portland, Oregon, based Esco Corporation announced a $175 million IPO. The company designs and manufactures critical wear parts used in mining, power generation and aerospace. Esco has 13 manufacturing sites, 20 sales and distribution offices and 4,679 employees. Sales last year were $849 million with net income of $28.6 million. Since 2005, Esco has spent $100 million on 5 acquisitions.

Another Wind Energy Foundry?

2011-04-28T10:01:00.002-05:00

Who are these guys?
North American Ductile Iron Company (Nadicom) announded at the Iowa Wind Energy Conference in Des Moine on April 27 they would be building a ductile iron wind energy focused foundry in Iowa City. The foundry expects to employ 175 employees when it starts operations in 2013. The average wage will be $18 per hour. Nadicom is headquartered in Fulton, Maryland. The CEO of Nadicom is Prasad Karunakaran. He is also the President of Zenyon, located at the same address. Zenyon describes itself as a small, minority owned information technology service. Computer guys building ductile iron foundries?

Navistar Recovery

2011-04-24T07:54:00.002-05:00

PurePower Technologies, the Navistar subsidiary that operated the engine block/head plant in Indianapolis announce they are recalling 150 laid off workers by June. In addition, they expect to add 100 new positions between now and 2014.

Rail is on the Way Back

2011-04-24T07:35:00.002-05:00

American Railcar Industries, St. Charles, Missouri, announced that Ohio Castings, Alliance, Ohio, is reopening after being closed for nearly two years. American Railcar is a one-third owner of the foundry. Production is expected to restart in the third quarter of this year. Railcar orders have been on the rise to a strong enough level that it warrants more production capacity.

Bad News in the Improving Economy

2011-04-04T08:26:00.002-05:00

General Aluminum, Conneaut, Ohio, notified the Georgia Department of Labor they would be laying off 67 employees at their die casting plant in Rome, Georgia. This is the entire workforce at the plant and General Aluminum indicated the layoffs may be permanent. Rome Die Casting was created in 1972 and encompasses 110,000 square feet.

J. L. French Spending Money

2011-03-28T12:19:00.002-05:00

J. L. French, Sheboygan, Wisconsin, announced they will be investing $18 million to expand production operations. After a 2009 bankruptcy and employment that dropped to 600, French's employment is now back to 920 and growing. The company is nearing record employment levels based on the improved economy, especially in automotive manufacturing.

Ship Castings in a Week? Big Deal.

2011-03-24T10:53:00.003-05:00

If you think shipping castings within one week of casting is good, consider this. Mercedes Benz is building a complete engine manufacturing plant in Mannheim, Germany, to manufacture the OM 47x engine. It includes an iron foundry, machining and assembly. When it is complete, the total time from casting to completed engine will be six days. For a more complete description go to finchannel.com/news_flash/Oil_%26_auto/83430_New_engine_manufacturing_facility_at_Mannheim_plant%3A_international_benchmark_for_precision,_quality/

More Castings Must Be Wearing Out

2011-03-03T10:07:00.003-05:00

ME Elecmetal with foundries in Chile and the U.S. has started a $10 million expansion of their iron/steel foundry in Duluth, MN. ME Elecmetal produces primarily iron and steel wear parts used in mining applications. The Duluth expansion will add 30 jobs to the 150 currently employed there.

Grede Acquires Two Foundries in Mexico

2011-02-21T14:35:00.002-05:00

On February 21, 2011, Grede Holdings LLC announced the acquisition of two Mexican foundries from Proeza. The foundries are NovoCast and Teknik, both located near Monterrey. The NovoCast foundry was formerly a joint venture with the Grede's predecessor and know, one time as ProezaGREDE.

Ray Witt Passes

2011-02-21T14:01:00.002-05:00

Those of you who have been around the foundry industry for a few years will remember Ray Witt. Ray Witt died February 6, 2011 at the age of 82. Ray began his career in 9147 at C.W.C. Foundry. From there he went to Cadillac Malleable Iron Company where he remained until starting Ray Witt Industries in 1957. In 1960 he founded Cast Metals Industries with the purchase of Cadillac Malleable. Cast Metals Industries grew into CMI International, one of the largest metal casting groups of the time. CMI was sold to Hayes Lemmerz International in 1999. Ray was a past President of AFS and other foundry related organizations. He was one of the most well known foundrymen of the time.

Partial Help for Magnesium Users

2011-02-17T11:49:00.002-05:00

The U.S. International Trade Commission ruled last week that when tariffs on Russian magnesium imports expire, they will not be renewed. However, they did leave in place tariffs on magnesium imports from China. U.S. users of magnesium alloys are paying a premium of $.50 to $.85 per pound over world prices putting them at a competitive disadvantage. There are no import duties on magnesium castings coming into the U.S. While only a partial victory, it will hopefully help. The tariffs are in place to protect the only U.S. magnesium producer.

Bradken Engineered Products Expanding Amite Foundry

2011-02-08T16:41:00.002-05:00

Bradken Engineered Products announced an $18.1 million expansion of their steel foundry in Amite, Louisiana. The U.S. operations of Bradken are based in Atchison, Kansas. Bradken is the successor to Americast Technologies which was the successor to Atchison Foundry. The expansion will add 171 new direct jobs.

Harvey Industries Acquires R. E. Phelon

2011-02-08T15:28:00.003-05:00

Harvey Industries announced the acquisition of R. E. Phelon, Aiken, South Carolina. Phelon is an aluminum die casting company producing products for numerous industries. Pro-forma sales are about $24 million and the company employs about 130 people.

Where Are The Americans?

2011-02-07T11:33:00.002-05:00

First it was URV, Finland, announcing they are building a 40,000 ton per year foundry in Eaton Rapids, Michigan, to cast low cost wind energy components. Now, Spanish wind energy component producer Fundiciones Wind Energy Casting (W.E.C.) has received permits to build a foundry in Hutchinson, Kansas, to support a Siemens wind energy plant. Air permits were granted but identities are being kept very low key. In it's request for a grant to extend its industrial park, the city of Hutchinson says the foundry would employ about 130 people at wages ranging from $18 to $24 per hour, a high wage. The $40 million foundry must be completed by January, 2013, for W.E.C. to receive $7 million in Federal grants. Where are the Americans?

What's Going to Happen to Magnesium Tariffs?

2011-02-07T11:17:00.002-05:00

In 2005, the U.S. International Trade Commission imposed tariffs on magnesium from outside the United States to protect the only producer left in the country - Utah based U.S. Magnesium LLC. Those tariffs are set to expire at the end of this year under sunset provisions. This week, the ITC will decide whether to extend those tariffs to protect U.S. Magnesium and their 360 union employees or let the tariffs expire. Several U.S. diecasting companies have objected to continuing the tariffs. U.S. diecasters are paying about $2.30 per pound for magnesium while competitors in other countries pay between $1.36 and $1.50 per pound, a premium ranging from $.80 to $.96 per pound. The diecasters primarily leading the effort are Spartan Light Metal and Continental Casting. North American Diecasting Association estimates that 1,875 direct jobs and 8,000 support jobs have been lost because of the tariff. The diecasters say the number is closer to 19,000. Whatever the number, is should be obvious that you can't be competitive when you pay an $.85 per pound premium for raw material. The question becomes, is that worth protecting the only producer?

Revstone's Buying - Again

2011-02-03T15:15:00.003-05:00

Revstone announced today they have entered into an agreement to purchase Tisamatic S. de R.L. de C.V., a gray/ductile iron foundry in Mexico. Tisamatic is owned by Industrias XCignux S.A. de C.V., a $2.5 billion manufacturing group. Tisamatic produces castings for the automotive and appliance industries on Disamatic molding lines plus produces a proprietary line of cast iron pipe. The company produces about 60,000 metric tons per year of castings. The purchase is in due diligence at this time and is expected to close in the first half of the year.

Neenah Has a New President

2011-01-06T16:04:00.002-05:00

Neenah Enterprises, the parent to Neenah Foundry and the related companies has named a new President. It is Thomas Riordan. Mr. Riordan was President of Terex Corporation which recently sold its construction equipment business to Bucyrus International. Prior to joining Terex, he was with SPX Corporation.

Dynacast on the Market?

2010-11-19T16:11:00.002-05:00

Melrose,Plc, has retained advisory firm Rothschild to advise it on the sale of Dynacast. Dyncast is reported to generate profits of 40 million pounds a year. The asking price is expected to exceed 350 million pounds. Dynacast was acquired by Melrose from Cinven in 2005. Dynacast is headquartered in Charlotte, North Carolina, and has plants world--wide.

Allegheny Technologies Acquires Ladish

2010-11-18T10:37:00.002-05:00

Allegheny Technologies, Pittsburgh, PA, announced on November 17, 2010, they were acquiring Ladish Company, Cudahy, WI for $778 million. Ladish produces forgings, castings and machining components. About 88% of their sales are aerospace. Ladish sales in 2009 were $350 million down from $470 million in 2008. Sales in 2010 are expected to be about $400 million. The casting company is Pacific Coast Technology (PCT) an investment casting company. The companies believe the synergistic effect of the combination could add as much as $100 million in sales to Ladish.

Ross Sand Casting to Close

2010-11-08T10:32:00.003-05:00

Ross Sand Casting, Orrville, Ohio, has announced casting production is stopping December 10, 2010. Ross is a part of Ross International, Washington, PA. Ross International is a leading manufacturer of gray iron glass molds. The 87 employees will be gradually reduced as the work-in-process is finished. The property is being purchased by J.M. Smucker as an expansion of their campus in Orrville. Ross indicated they have surplus capacity at this time and the plant had been unprofitable.

Machine Shop Can't Get Parts: To Start Own Foundry

2010-11-01T12:23:00.002-05:00

Spectrum Machine, Streetsboro, Ohio, machines and sells brass, bronze and copper parts. They have had such a hard time getting parts, they are going to open their own foundry. The Ravenna planning commission has given their approval to the plan. The foundry is expected to open within the next 18 months. The article did not say what type of foundry but did say there is no sand involved. Looking at their website, www.spectrummachine.com, we would guess a centrifugal foundry.

Lawton Ups the Ante

2010-10-22T09:07:00.002-05:00

C.A. Lawton, an iron foundry in DePere, Wisconsin, producing castings to 15,000 pounds with an adjoining machine shop has received a $1.3 million development loan to expand their foundry. The loan is to retool to produce large energy wind castings. The total investment will be $5.3 million and create 10 jobs.

Foundry Not Built is Expanding

2010-10-22T08:49:00.002-05:00

URV USA, a joint venture with Finish foundry Uudenkaupungin Rautavalimo Oy (www.urv.fi) has announced they are upping the ante for their to be built foundry in Eaton Rapids, Michigan. The foundry is designed for low cost production of large wind energy components and is being built adjacent to the machine shop castings will go to. Initially planned at 40,000 tons per year, it is being expanded to 80,000 tons per year adding 275 employees and will be in operation by 2014. URV USA also said that if additional funding is available from the US Department of Energy, the plant could go as large as 160,000 tons per year. URV USA has already received a matching fund grant of $4 million from the US DOE.

What About Etowah?

2010-10-13T14:09:00.002-05:00

ThyssenKrup Waupaca announced on Tuesday, October 12, 2010 they were investing $36.5 million in their Tell City, Indiana, foundry to expand. The investment will add 160 jobs in the 480,000 square foot plant. The foundry in Etowah, Tennessee was moth-balled during the recession and remains closed.

One Big Oven

2010-09-15T08:39:00.001-05:00

St. Marys Foundry located in St. Marys, Ohio, is known for big castings - up to 60,000 pounds. Shortly they will have a very big heat treat oven to anneal them in. They are installing a heat treat furnace that is 174 feet by 182 feet. That's one big oven!

Look Out When the Feds Have You in Their Sights

2010-08-30T09:44:00.002-05:00

John R. Wiehl, owner and President of Franklin Non-Ferrous Foundry, Franklin, New Hampshire was indicted by a Federal grand jury for illegal storage of hazardous waste. This means that he will be brought to criminal trial. The indictment alleges that Franklin stored hazardous waste beyond the 90 days they are allowed. In fact, the government claims the last shipment of hazardous waste from Franklin was in 2005. Wiehl faces a potential of up to two years in jail and a $250,000 fine. The company also faces a fine of up to $500,000.

In December, 2009, Franklin was fined $250,000 for OSHA violations. The local paper at the time stated that Franklin Non-Ferrous had been fined an additional $387,000 by OSHA in the previous four years.

Brazilian Foundry Industry Improving

2010-08-23T09:30:00.002-05:00

Devanir Brishesi, President of the Brazilian national foundry association (Abifa) reported that Brazilian foundry output increased in the first 7 months of 2010 to 1.82 million tons, a 50.3% increase from the same period in 2009. This was, however, still 12% lower than the same period in 2008. Abifa is forecasting 3.1 million tons for 2010 compared to 2.3 million tons in 2009 (a 35% increase for the year) and compared to 3.36 million tons in 2008 (an 8% decrease). Exports also increased from 2009 but are still 40% below the 2008 period. Most exports are to the US and Europe. The outlook for the domestic market is more favorable due to the strength of the economy and investments in infrastructure.

Kovatch Breaks Ground

2010-08-23T09:18:00.002-05:00

Kovatch Castings, an investment casting foundry in Uniontown, Ohio, broke ground on August 13 for the previously announced 15,000 square foot expansion. The employment at the foundry increased to 172 in March from 150 in November/December. Doug Kovatch, President, expects the addition to allow the company to grow from $15 million to $25 million. The foundry received a $1 million state American Recovery and Reinvestment grant from the Targeting Energy Efficiency program to assist in the cost of the expansion. The expansion will include two new state-of-art process ovens and a heat recovery system for the air compressors.

Work and Jobs Coming Back from China to Michigan

2010-08-19T17:12:00.003-05:00

Premier Tool and Die Cast shut down their zinc die casting operations in Dowagiac, Michigan, about four years ago due to the loss of work to China. That work is coming back to the U.S. Premier is now planning to reopen the facility with the help of $862,000 in tax credits over the next five years. Premier plans to invest about $3.2 million in the project. The plant used to house ICG Castings, formerly Inverness Castings Group when owned by the now defunct Atchison Casting. A Premier representative said about 80% of the work will be for Benton Harbor based Whirlpool Corporation.

American Brass & Aluminum Acquired

2010-08-19T17:00:00.001-05:00

American Brass & Aluminum, City of Commerce, California was acquired Wednesday by IPS Corporation, Compton, California. ABI produces plumbing fittings and IPS produces adhesives used in plumbing.

Kenton Iron Fined $214,500 by OSHA

2010-07-19T09:04:00.002-05:00

The Ada Herald reported on Friday, July 16, 2010, that Kenton Iron Products, Kenton, Ohio, was fined $214,500 by the U.S. Department of OSHA. There were three willful citations with fines of $156,000 primarily related to lockout/tagout procedures, 22 serious violations for $50,700 and 3 repeat violations for fines of $7,800. The 80 employee foundry operation has had 10 inspections since 1981 and 49 previous citations.

Bremen Castings Gets Tax Abatement

2010-07-16T15:42:00.003-05:00

The Bremen Common Council approved a $2.8 million tax abatement for Bremen Castings during its recent meeting. The abatement is in recognition of the estimated 37 jobs Bremen will be adding with new equipment. The abatement is for 5 years on personal property and for 10 years on real estate.

Foundry Saved!

2010-07-16T10:24:00.002-05:00

In 2007, the Navistar Indianapolis diesel engine foundry and manufacturing plant employed a combined 1,625 people. The loss of Ford Motor work and high costs prompted Navistar to announce they were closing the entire facility as of July 31, 2010. The Chicago Tribune announced yesterday that the remaining 250 UAW foundry workers agreed to a 5 year labor contract that will keep the foundry open. To accomplish this, the union employees agreed to 23% pay cuts, less vacation, reductions in health care and buyout packages for older workers.

Lightning Puts Littler Die Casting Out of Commission

2010-07-12T08:55:00.002-05:00

On Thursday, July 8, after the shift ended for the day at 4 PM, lightning struck Littler Die Casting, Albany, Indiana. The fire was under control by 6:45 PM but not before it gutted the plant according to the local fire chief. No employees were in the building at the time and none were injured. The fire chief also speculated the building was a total loss.

Fire at ThyssenKrupp Waupaca Tell City Plant

2010-07-02T08:01:00.003-05:00

A fire reported in the melt department of ThyssenKrupp Waupaca's Tell City, Indiana, plant has shut the plant down. The late Thursday morning fire was contained fairly quickly and no one was injured. Observers reported dense smoke caused by burning hydraulic fluid. Tell City employs 880 people in two foundries on the site. The report did not indicate which foundry had the fire. Each Tell City foundry operates four Disa-matic molding machines. This may be good news for Etowah, Tennessee, the mothballed Waupaca foundry. Industry sources told us the Waupaca operating plants were at capacity. Will Waupaca rush the re-opening of Etowah with the loss of capacity at Tell City?

Now You Can Really Smell Like a Foundry

2010-07-02T07:41:00.002-05:00

Germany is the leading iron casting producing country in Europe. Most people would say the smell of an iron foundry is not a turn-on. However, people in Saarbruecken, Germany, think otherwise - at least some do. The fragrance is called "Brebacher Breeze" and is named in honor of Halberg Guss, an iron foundry operating in bankruptcy located in the Brebach District. Halberg Guss employs 1,000 people in Saarbruecken and Manfred Hahn, the manager of the Brebach District wants people to know the smell has a good side. He described the fragrance as having the smell of smoked ham and tar. The fragrance was formulated by a professional perfumer. The basis for formulating the smell, as confirmed by the Dusseldorf Institute for Foundry Engineering, is train brakes that are running hot. An employee of Germany's train system testing laboratory provided Mr. Hahn with a 2 1/2 kilogram burned trained brake for reference. The perfume formula is secret but it does consist of 38 ingredients. The price is about $2.50 per bottle but the article we read does not provide instructions on where to buy a bottle. Love that smell? Now you can take it with you.

Neenah Out of the North Woods?

2010-06-28T09:07:00.002-05:00

Neenah Enterprises (Neenah Foundry) has secured $135 million in exit financing in their current attempt to exit bankruptcy. It includes a $75 million revolving credit line from the Bank of America and $60 million in term loans from Golden Tree Asset Management and MacKay Shields. Voting on the plan is to be complete by July 2 and approval by the court on July 6. When Neenah filed for bankruptcy in February, 2010, they reported $286.6 million in assets and $449.1 million in debt. Their fiscal year ending September 30, 2009, reported $333 million in sales and $150 million net loss. The plan called for secured debt holders at the time of the filing to receive the stock of the company and for the stockholders at that time to get nothing. The stockholders at the time of filing had been the secured lenders from the previous bankruptcy.

New Wind Energy Foundry in Michigan

2010-06-28T08:48:00.002-05:00

A joint venture between Astraeus Wind Energy and URV Foundry, Finland, will build a green field iron foundry as part of the Astraeus Energy complex in Eaton Rapids, Michigan just south of Lansing Michigan. It will be funded in part by a $3.5 million grant and a $500,000 loan from federal stimulus funds. Astraeus is an affiliated company of Dowding Machining and MAG Industrial Automation. Astraeus is a new company founded in 2009 that is skilled in landing grant funds from both the federal government and Michigan. In December, 2009, Astraues was awarded a $7 million grant to develop a wind hub machining cell and in April, 2010, a $6 million grant to develop advanced wind turbine blade components.

Erie Coke to Stay Open

2010-06-18T08:07:00.002-05:00

The owners of Erie Coke paid a $6 million fine yesterday and agreed to terms for keeping Erie Coke open and operating. Erie agreed to rebuild 27 of their 58 coke ovens over the next three years. There are other operating upgrades included in the settlement that are designed to bring the plant into environmental compliance. This is good news not only to the 120 employees but also to operators of cupolas who feared a disruption in coke supply.

Nothing Runs Like a Deere

2010-06-10T07:53:00.003-05:00

The Chicago Tribune reported today that John Deere plans to invest $100 million dollars over the next 4 - 5 years in its Waterloo, Iowa, foundry. According to Deere executive David Everitt, the integrated approach (i.e. captive foundry) gives Deere a competitive advantage. The Iowa Department of Economic Development has agreed to provide Deere with tax incentives to retain jobs in Iowa.

Iron Foundry to be Auctioned in Bankruptcy

2010-06-08T08:10:00.002-05:00

While Franklin Treefarmer isn't a typical name for an iron foundry, they do have a primarily captive foundry. Franklin is based in Franklin, Virginia, produces timber handling equipment and acquired the Holt Equipment Company in Independence, Oregon in 1968. They renamed the company Franklin Sweed. The foundry produces ductile iron castings to 1,000 pounds. On June 8, 9 and 10, Atlantic Asset Management Group will sell all of the bankrupt company's assets at auction.

Shreveport Brass Works? Closed.

2010-06-07T10:37:00.002-05:00

Shreveport Brass Works is closing after 93 years in business. Third generation owner Ardis Nicholson told The Shreveport Times she mortgaged her house and used all her savings to keep the foundry going. She sold the company's castings to Martin Sprocket & Gear in Arlington, Texas. She further stated that U.S. industry cannot compete with China.

You'd Better Cover Your Coke

2010-06-01T07:36:00.002-05:00

Erie Coke Corporation was ordered closed by the Pennsylvania Department of Environmental Conservation on June 2, 2010. An administrative law judge has granted a temporary reprieve to June 18, 2010. Erie is one of only four plants in the U.S. that produces foundry grade coke. One other, located in Tonawanda, New York, is also owned by J.D. Crane and is subject of reprimands and fines by the New York DEP. Erie operates 58 coke ovens and employs 120 people. The company is currently appealing $6.1 million in fines incurred from a March 2008 power failure that allowed excessive emissions. The company has had 50 inspections since 2007 and has been cited for 108 violations from October, 2006 through March, 2008. In the company's appeal to the court, the company stated that there is not enough excess coke production capacity in the U.S. to compensate for the loss of coke produced by Erie. Even if Erie does not close, look for coke prices to increase.

Someone has Faith

2010-05-25T10:09:00.002-05:00

A group of investors from Cadillac Casting has acquired the closed Radford, Virginia, iron foundry from the bankrupt Intermet for $126,000. While the purchase price is very low, Virginia Castings as the foundry will be known, is planning an investment of $9.1 million supported by a $600,000 state grant. Virginia Castings told local officials they plan to employ 300 people at an average salary of $39,300 before benefits. Dan Minor and an investor group acquired Cadillac Casting late in 2005.

Business is Looking Up at Kovatch Castings

2010-03-19T12:33:00.003-05:00

Kovatch Castings, an investment casting foundry in Uniontown, Ohio, received approval from the local zoning board for a 15,430 square foot addition. Employment at Kovatch was reported up from 150 employees in November - December to 172 currently. The addition is expected to provide the ability for further growth and add another 30 to 45 jobs.

Neenah on the Way Back

2010-03-15T08:07:00.002-05:00

Neenah Enterprises, one of the largest foundry groups in the U.S. announced they have secured $140 million in DIP financing. $50 million is a term loan and $90 million is a revolving credit loan. This will allow Neenah to continue operating post-petition in a relatively normal fashion. It also signals that the lender believes Neenah has a viable plan of operations going forward.

Bad News from Gunite

2010-02-19T09:16:00.002-05:00

Yesterday Gunite announced they will be closing the plant in Elkhart, Indiana. Work there will be moved to the Gunite plant in Rockford, Illinois, and to sister company, Brillion Corporation, Brillion, Wisconsin. The closing will result in the loss of 225 jobs. Gunite as a part of Accuride is a major producer of heavy duty brake drums, wheels and hubs for large trucks.

Good News from GM

2010-02-19T09:11:00.002-05:00

At a press conference on Thursday, GM announced they were investing $59 million in their Defiance, Ohio, aluminum foundry to produce blocks for their Ecotec engine. This is expected to add 80 jobs to the 1,300 employees already working their. The state-of-the-art installation is to provide engines for the 2011 Chevrolet Cruze.

Fort Wayne Foundry Closing

2010-02-12T14:01:00.001-05:00

After cutting jobs and wages, beleagured Fort Wayne Foundry is closing effective February 26, 2010. Fort Wayne is a green sand aluminum foundry that has not been able to survive the downturn.

Neenah Enterprises Files for Bankruptcy (Again)

2010-02-12T13:47:00.004-05:00

Neenah Enterprises has filed for bankruptcy. This is a financial filing that will reduce their debt by $220 million while providing vendors and suppliers with 100% payment. As of September 30, 2009, Neenah reported $286.6 million in assets and $449.1 million in liabilities. The agreement converts the secured debt to common stock and $50 million in secured debt. Existing stockholders are wiped out in the process. Neenah's common stock was 58% owned by Tontine Capital Partners.

The Times Have Changed

2010-02-12T13:30:00.002-05:00

In 2006 the U.S. Pipe & Foundry division of Mueller Water Products was considering a $45 million plant to expand capacity. This week they announced they are closing their North Birminghan plant due to low sales. The plants in Bessemer, Alabama and Union City, California are able to supply all their current ductile iron pipe requirements.

A Grede Up-Date

2009-12-28T09:36:00.002-05:00

A lot has been happening at Grede. Here's where the process currently is:

1. The U.S. Bankruptcy Court for the Western District of Wisconsin approved the sale of most of the assets to Wayzata Investment Partners on Tuesday, December 22, 2009. Wayzata made a "stalking horse" offer for the assets. Other buyers stepped forward but none were willing to bid higher than Wayzata. Closing should be in late January or early February, 2010. Included in the sale are Grede's headquarters in Milwaukee and the foundries in Wauwatosa, Wisconsin; Reedsburg, Wisconsin; St. Cloud, Minnesota; Wichita, Kansas; New Castle, Indiana; and Iron Mountain, Michigan. There are 1,600 employees at all these facilities.
2. Greenwood Foundry has been closed and Grede is selling the real estate and equipment.
3. Vassar Foundry (Vassar, Michigan) was sold to Revstone Industries last week. Revstone has been acquiring automotive focused companies at very, very low prices.

West Coast Foundry Acquires Gould's Ashland Foundry

2009-12-15T11:36:00.003-05:00

Michael Bargani, owner of 100 employee West Coast Foundry, Huntingdon Park, California, has acquired the ITT Gould Pump steel foundry in Ashland, PA. The foundry is being renamed Ashland Foundry and Machine Works. It employs 183 people and Bargani plans to expand that. West Coast Foundry is also an alloy steel foundry.

Bad Foundry or Bad Press?

2009-12-14T08:25:00.002-05:00

Franklin Non-Ferrous Foundry, Franklin, New Hampshire, was recently fined $250,000 by OSHA for several violations. This is a pretty serious level of fines for any foundry but especially for one that has a total of 8 employees. Franklin produces leaded bronze castings. Owner John Weihl took the unusual step of inviting a local reporter to tour the plant. For this unflattering story go to www.concordmonitor.com/apps/pbcs.dll/article?AID=/20091213/FRONTPAGE/912130367.

No, Vassar's Not Closing

2009-12-10T07:59:00.002-05:00

As reported by NBC25, MidMichigan, December 10, 2009:

In Vassar, the talk around town is that the Grede Foundries, Inc., which employs around 150 workers, is closing up. NBC25 made some calls and found out that's not the case. The Milwaukee based company says there's a potential buyer of the company and that termination of employees simply means the employees would no longer be working for Grede, but another company. It says, if the sale does not go through, workers will continue operations. The company says, significant work is coming into the plant and that no jobs will be lost.

It sounds as though Vassar is not closing.

Selling or Closing?

2009-12-09T08:38:00.002-05:00

From mLive.com, December 9, 2009:

Vassar - Grede Foundries, Inc., has informed the City of Vassar it will close its facility at 700 E. Huron St.. "The closing is to be permanent, " Eric Ek, President of Grede Foundries said in a letter to the city. "All employees will be separated during the fourteen day period beginning on January 9, 2010. There are no bumping rights in existence for employees except for those in the bargaining unit represented." Most of the affected employees at the facility are represented by Locl 564 of the United Steelworkers Union. A total of about 178 employees will be affected by the closing. Gred is currently in active negotiations with a potential buyer to purchase the Vassar Foundry. If the sale goes through, Ek said many of the employees may be offered employment with the buyer at the facility. Details of the sale are still being negotiated and have not been made public.

Closing or selling? Stay tuned for the next episode in the life of Vassar Foundry.

Citation Corporation Buys Blackhawk Foundry Work

2009-12-03T12:52:00.002-05:00

Citation Corporation has completed the purchase of Blackhawk Foundry and Machine. The work and selected equipment will be moved to other Citation plants. Blackhawk Foundry, owned by the Grafton family, will close in January. Blackhawk has been in operation since 1920.

Is Grede Worth More Than $105 million?

2009-11-17T08:27:00.002-05:00

Wayzata Partners has offered a stalking horse bid of $105 million for Grede Foundries. Typically, a stalking horse bid is a low bid but insures an end to the sale process. In the case of Grede, competing bids need to be at the bankruptcy court prior to December 2, 2009 with an auction scheduled for December 9, 2009. If there are going to be other bidders, look for them coming in just a day or two before December 2.

Blackhawk Foundry, Davenport, Iowa, to Close

2009-11-17T07:46:00.002-05:00

On November 12, 2009, employees of Blackhawk Foundry, Davenport, Iowa were informed that company assets were being sold to a buyer and the foundry would be closing. The buyer was not named nor the assets identified. Blackhawk currently is down to 127 employees according to a local newspaper report. It has been a difficult two years for Blackhawk, going beyond the downturn in the economy. In June, 2009, a particulate monitoring station just blocks from the foundry registered higher than Federal limits of particulate matter. About 90% of the particulate matter was traced back to the foundry. In August, 2009, the foundry agreed to remove lead contaminated soil from their site, to cap the area, insure that there was no migration of pollution from the site and refrain from further polluting. Blackhawk is a long established foundry operating a cupola melt department in a residential area of Davenport.

First It's Closing, Now It's Not

2009-11-12T08:38:00.002-05:00

Yesterday the Columbus Ledger-Enquirer announced that Intermet was closing its Columbus, Georgia, iron foundry. Today, they announced it is being purchased by Diversified Machine, Inc., a Wixom, Michigan based supplier to the automotive industry. Diversified Machine was founded in 2005 by a small group headed by Bruce Smith. In 2008, Diversified acquired aluminum casting plants in Bristol, Indiana, Milwaukee, WI and Montague, MI, from Aluminum Casting and Engineering. Diversified has extensive machining operations and purchases iron castings for steering knuckles. Swift estimates the volume at the plant will double in the next year.

Intermet Closing Another Foundry

2009-11-11T10:13:00.002-05:00

Intermet sent notice to the state of Georgia they are closing their iron foundry in Columbus by the end of the year. The foundry employs 169 people down from the 1,100 employed their 10 years ago. Intermet has announced recent closings of their foundries in Archer Creek, VA (192 employees) and New River, VA (76 employees). Gordon Cole, consultant to Cerion Corporation, stated the deal for Cerion to purchase Intermet fell through. In their July, 2009, filing to the bankruptcy court, Intermet stated they had profits of $33.8 million and that Columbus Foundry had losses of $2.8 million.

Kulp Foundry Closing

2009-11-11T09:31:00.003-05:00

Kulp Foundry has been in business over 60 years producing iron castings in Stroudsburg, PA. At their peak, just a few years ago, they employed 75 people. Now down to their last 15, they are closing the foundry. Fairmount Foundry, Hamburg, PA, is taking all the work.

Larry Dine, St. Marys Foundry, Passes

2009-10-05T08:53:00.002-05:00

Larry Dine, Chairman, of St. Marys Foundry, St. Mary, Ohio, died September 5, 2009. St. Mary's was founded in 1917 and later closed. Larry organized a group of friends and purchased and reopened the foundry. St. Marys remains an employee owned foundry. It is managed by his daughter Angela Dine Molaskey. Larry worked for St. Marys for 60 years.

Old Line Foundry Files for Bankruptcy

2009-10-05T07:18:00.002-05:00

On Friday, Goldens' Foundry and Machine, Columbus, Georgia, filed for bankruptcy. Goldens' has been operated by the same family since its founding in 1882. According to local newspaper reports, President and CEO George Boyd, Sr., believes the company will continue to operate with no layoffs, pay its employees and suppliers and not have any disruption in supplying customers. The company's sales are off 50%. In 2007, Goldens' acquired the Georgia Ductile facility (except the Loramendi molding lines) in Cordele, Georgia. They installed a new Savelli 28x36 12/12 automated molding line with automatic core setting.

Is Grede on the Upturn?

2009-09-17T14:35:00.003-05:00

Grede announced receiving $23 million in new work and sees the market turning up. They see a recovery in manufacturing and automotive business. Employment at its Reedsburg, Wisconsin, plant has increased by 25% since June and by 100% at St. Cloud, Minnesota, plant due to the combined effects of closing its Vassar, Michigan, and Wichita, Kansas, plants and increasing business. Their other foundries have also been increasing employment. Maybe now that they are "right sized" they will return to profitability.

ThyssenKrupp Waupaca Consolidating Work

2009-09-17T14:30:00.002-05:00

ThyssenKrup Waupaca announced it is mothballing its Etowah, Tennessee, plant indefinitely effective January 1, 2010. The work at the facility is being moved to its five other foundries. The shutdown is due to the continuing slump in the automotive and truck markets. This won't be capacity lost to the industry as ThyssenKrup will be maintaining the facility in anticipation of reopening it when volume returns. The facility has 243 hourly and 43 salaried personnel.

J L French to Come Out of Bankruptcy

2009-09-08T12:21:00.002-05:00

A federal judge has approved J L French's plan to come out of bankruptcy. The plan calls for 100% of the equity in the company to be transferred to the debt holders. The amount of the debt is $224 million. The Company reported its sales were down 45% in 2009 from the same period in 2008.

Mickey Garrity Retired?

2009-09-02T13:48:00.002-05:00

A Richmond, Indiana, newspaper reported yesterday that Mickey Garrity sold Richmond Castings to long time employee Gil McBride on August 5, 2009. The paper reports the selling price at $6 million for the 37 employee gray and ductile iron foundry. Mickey has long been a popular and visible leader within the foundry industry.

Grede to Close Vassar Foundry

2009-08-21T09:50:00.002-05:00

First, Grede announced the sale of Vassar Foundry. An iron foundry employing about 145 people, Vassar is larger than the average foundry but not a "big" foundry. Apparently buyers are hard to come by. On Thursday, Grede announced they will be closing Vassar Foundry.

Grede Foundry Closing

2009-08-21T09:31:00.002-05:00

Bankrupt Grede Foundries announced on Thursday they are closing the Wichita, Kansas, foundry over the next few months. It will fully closed in early 2010. The work will be moved to other Grede foundries in St. Cloud, MN, New Castle, IN, Reedsburg, WI and Iron Mountain, MI. The plant currently employs about 60 people down from their peak employment of 250.

Magnesium Update

2009-08-13T15:59:00.002-05:00

from Purchasing, 8/13/2009 -

The demand for magnesium is down 10% this year due primarily to the decline in demand from the automotive market, the major user of magnesium. A downturn is aerospace and other industries has further contributed to the decline. Industry sources don't expect to see a return until the 2011 - 2012 time frame. Usage is down to 67,300 metric tons annually from 81,600 mt. Even with the decline in demand there are shortages on the U.S. spot market due to the decline in imports from Russia and Canada.

Magnesium prices peaked at $3.65/lb in July, 2008 and were $2.29/lb in July, 2009.

The U.S. and Europe have filed a complaint with the World Trade Organization because of Chinese restrictions on the export of magnesium ingot. The restrictions have driven up world prices while keeping them low domestically. This serves as price supports for Chinese die casters.

Chinese ingot producers are delaying negotiating the 2010 ingot supply contracts until winter. Normally, contracts are negotiated in late summer or early fall.

Signs of Better Times?

2009-08-12T08:01:00.002-05:00

Two foundries this week announced good news . . . a great change from the last months of bad news. Grede Reedsburg has rehired 140 laid off workers and gone from one shift to two shifts with an extended third shift. Even better news is that the rehires started before the "cash for clunkers" program. Company spokes person Konya Harrision said that was a bonus. However, Konya did say that while people were smiling at Reedsburg, "things are still tough." Grede is operating in bankruptcy while seeking to find a buyer for the company. Employees at Reedsburg are being paid the same wages as pre-bankruptcy days.

In Sparta, Michigan, Federal Mogul is spending $3.7 million on foundry expansion and upgrades. While it will result in relatively few hires . . . about 5 . . . this kind of investment is always good news.

We are consistently hearing foundries telling us they are starting to book orders at a better rate lately. However, we are a long way from where we were and no one is predicting how fast the return will occur. It remains to be seen the impact of lost capacity during the return.

Ertl/Dyersville Die Casting Acquires Hubbell Die Casting

2009-08-07T15:24:00.002-05:00

A company called JDJ Operations has acquired the die casting operations of Hubbell in Moultrie, Georgia. JDJ is an affiliate of Dyersville Casting and Joseph L. Ertl, Inc. The company produces both jobbing castings and large die cast toys. Think of the die cast tractor kids ride on. The company will initially employ 27 people. The company hopes to grow the company to larger than its peak employment of 130 people.

Intermet - Selling at Bargain Basement Price?

2009-08-05T08:48:00.001-05:00

Cerion LLC, a division of Revestone Industries has been gobbling up automotive and tier one suppliers at bargain prices. It appears that Intermet will soon be added to the list. The selling price for all of Intermet's assets is $13 million plus assumption of $2 million in debt. That's pretty low price for a company that reported $33 million in net income for the six months ending June 30, 2009.

A Pretty Big Deal

2009-08-04T11:19:00.001-05:00

On August 4, 2009, MSN Money reported that ArvinMeritor, Troy, Michigan, entered into an agreement to sell their wheels business to Iochpe-Maxion, Sao Paulo, Brazil for $180 million.

Indian Foundries Coming Back

2009-08-04T09:17:00.004-05:00

Indian foundries are reporting that business is returning - but not from U.S. or European companies. The growth has come from their own automotive industry and the demand for spare parts. One newspaper reported that foundries have increased their output 55% to 60%. The demand is driven by a number of new models being introduced to the country and low interest rate loans.

The industry reports, however, that they are still operating at under 70% of capacity.

The filling of capacity bodes well for North American and European foundries. A lack of capacity in India will force customers to buy locally.

This picture shows in part why U.S. and European foundries have trouble competing. How many foundries in Western countries could operate this way?

A Little Good News

2009-07-17T06:47:00.002-05:00

Moderate Democrats in the Senate have agreed that the card check provision of the labor bill should be dropped. The card check provision would have automatically recognized a union as soon as they had 50% of the employees sign membership cards. Now, a confidential vote will still have to be taken. Also, the bill will not seriously be considered until September due to the effort being placed on the health care reform bill. Some provisions in the labor bill are definite, some are still being considered. There is time to contact your representatives in Congress. Here are some of the major points:

1. Elections would be required from 5 to 10 days after the union has 30% of the cards signed. This is to reduce the time the company has to fight the organizing drive.
2. Union organizers may be guaranteed access to company property.
3. Employers may be prohibited from requiring employees to attend anti-union meetings.
4. Companies could be forced to accept binding arbitration if they fail to reach agreement with the union on a contract.

Good News for Fort Wayne Foundry?

2009-07-16T07:53:00.002-05:00

While the executives at Fort Wayne Foundry (FWF) have been reluctant to talk to the local newspapers, their union leaderhship has not.

FWF closed its Lima Road operations in June due to the downturn in automotive sales. The union further reported that on June 2, 2009, GM notified the company it was pulling all its work from FWF. This prompted the company to file for bankruptcy on June 3, 2009. GMAC is the secured creditor. $2.3 million is owed to unsecured creditors as of the filing date. Major unsecured creditors include Allen County, Indiana - $575,000; NMHG Financial Services, $407,000; IRS, $321,000; AG Trucking, $229,000; Ashland Chemical, $197,000; Minature Precision, $103,000; and Beck Aluminum, $62,000.

It was released yesterday in several local papers that GM has entered into a six month contract for FWF to supply castings. Apparently, it's not as easy to shift work as GM thought. The unsual side of this is that 105 laid off workers will return to work at reduced wages and no health care benefits - with the union's agreement.

It's J. L. French's Turn - Again

2009-07-13T13:22:00.004-05:00

J. L. French filed for a prepackaged bankruptcy on July 13, 2009. The terms of the filing call for the company to reduce its secured debt from $280 million to $65 million via debt for equity swaps. A first lien holder is providing $15 million in cash to help with continued operations. Over 95% of the company's sales are to GM, Ford, Chrysler and Magna.

J. L. French went through bankruptcy in 2006.

This may be a very smart move. In their press release the company notes that it cleans up their balance sheet and makes them eligible for additional work, something that could not happen in their prior condition. With additional die casting companies such as Contech liquidating, there are significant amounts of work that will need a new home.

For additional information, see the press release on their website at www.jlfrench.com/news.htm#CFO

Industries to Watch?

2009-07-13T09:23:00.002-05:00

Bharat Heavy Electricals, Ltd. (BHEL) has announced a 1,000 CRORE ($200 million) series of joint ventures to make castings and forgings. The castings and forgings are for the nuclear and rail industries. In nuclear, BHET is talking to Areva (France), Tohshiba (Japan) and Westinghouse (U.S.). For locomotives, they are in talks with General Electric (U.S.) and Toshiba (Japan). Providing technical guidance to BHET is Sheffield Forgemasters of the U.K.

We believe these are growth markets. Nuclear will become more and more the preferred source of electrical power worldwide. Growth in rail will be strongest in third world countries looking to build their infrastructures. In the U.S., look for light rail to increase its challenge to the airlines on short haul routes. Rail stations are generally more conveniently located than airports, less expensive, more reliable and when you allow for required early arrivals at airports, time competitive under 150 miles. Rail stations do need to provide better access to rental cars.

Our predictions for heavy rail in the U.S. are more limited. Right now freight is down substantially due to the slow economy. Even when the economy returns to normal, don't look for major growth unless the rail companies design faster ways to assemble and dis-assemble trains. It can take more time to get a car to or from the local rail yard to your company than for it to move across the country.

Contech Path Not a Surprise

2009-07-08T08:14:00.002-05:00

On July 1, 2009, Revstone Industries, through Cerion Contech, withdrew their offer to purchase the assets of Contech. This really didn't surprise us since four of Contech major customers - Ford Motor, Automotive Components, BMW and Delphi - had objected to the purchase. See our blog posting of May 27. We surmise the four informed Cerion Contech they were pulling their work, but don't know that. Since Revstone was the only bidder with an offer over the expected liquidation value, Contech filed on July 2 to convert from a Chapter 11 bankruptcy to Chapter 7. This will liquidate Contech and be the end of the company. Notices were sent to the creditors yesterday.

A Bad Omen

2009-07-06T08:39:00.002-05:00

It's always a bad sign when a company hires a financial advisor. It's no secret Tontine has been anxious to get out for some time now.

Neenah has engaged Rothschild, Inc., as a financial advisor. CEO Bob Ostendorf said in a press release that efforts to streamline operations and reduce expenses have helped provide the company with sufficient liquidity to continue operations. Earlier this year, Neenah announced the closure of Gregg Industries, California, and Dalton Foundry, Indiana.

Tontine Capital Partners quietly filed with the SEC to go public in January, 2008, however there does not appear to be much success (or visible effort) on the part of Tontine to sell stock. There were 13.7 million shares outstanding according to the filing, the majority of which were held by Tontine.

Neenah invested over $50 million in a new molding line at their Neenah, WI, plant that was started in 2007 and completed in 2008.

Neenah also announced on July 1 that it has reached agreement with Tontine to defer a semi-annual interest payment that was due July 1. The company did pay interest on a lower rate senior note that was due at the same time. Neenah appears to be near default on a 2006 credit facility. If they default, the lender has the ability to terminate their commitments to lend, making Neenah insolvent.

Neenah saw net sales drop for the three months ended March 31, 2009, to $79.9 million and reported a net loss for the second quarter of $109.5 million. The net loss includes effects of a goodwill impairment of $88.1 million and restructuring cost and asset writedowns of $12.4 million related to the plant closures.