Target Information

Prime Material Recovery (PMR) stands as one of the largest non-ferrous metal processors and distributors in the United States. With its headquarters located in East Hartford, Connecticut, PMR operates advanced processing facilities in Canastota, New York; Willimantic, Connecticut; Shelby, North Carolina; and Orangeburg, South Carolina. Each year, PMR processes and brokers over 360 million pounds of non-ferrous metals, while also engaging actively in the global metal market through its import and export capabilities.

In its pursuit of enhancing multinational sourcing operations for high-grade metals, PMR has made a strategic acquisition of Allied Metal Corporation, based in Miami, Florida. Allied has specialized in importing non-ferrous metals from Latin America and the Caribbean for over 50 years, coupled with processing and distributing products on a global scale. The Mosheim family, headed by Paul Mosheim, will continue to lead the company in its international operations post-acquisition.

Industry Overview in the United States

The non-ferrous metal processing industry in the United States is a significant sector, driven by the growing demand for sustainable metal recycling and the need for raw materials in various manufacturing processes. As environmental regulations continue to tighten, the recycling of non-ferrous metals has gained importance, providing both economic and ecological benefits. The market is characterized by a high level of competition among several key players, each striving to leverage technology for superior processing and efficiency.

According to industry reports, the non-ferrous metals market is anticipated to see consistent growth, spurred by increased consumption in sectors such as construction, automotive, and electronics. The U.S. remains a leader in metal production and recycling, and its companies are continually adapting to the fluctuations in global metal prices, which can heavily impact profitability.

Moreover, the industry's expansion is bolstered by technological innovations that enhance the processing and recovery of metals from scrap materials. Companies that invest in state-of-the-art technology can improve yield rates and reduce operational costs, providing a competitive edge in the global market.

Additionally, the U.S. non-ferrous metal industry benefits from robust export markets, particularly to countries in Asia and Europe where demand for high-quality metals remains strong. The ongoing trade relationships and agreements facilitate seamless international operations, thereby ensuring sustained growth for players in this sector.

Rationale Behind the Deal

The acquisition of Allied Metal Corporation aligns perfectly with PMR's strategic goal of enhancing its international sourcing capabilities for high-grade non-ferrous metals. By integrating Allied’s longstanding expertise and established networks in Latin America and the Caribbean, PMR positions itself as a more dominant player in the global metal market. This deal not only expands PMR’s operational footprint but also diversifies its product offerings, thus creating synergies that can lead to increased revenues and market share.

Moreover, the collaboration between PMR and the Mosheim family is anticipated to be a mutually beneficial arrangement, as it allows for the continuation of Allied's successful operational strategies while bolstering PMR's growth plans. This acquisition underscores the company’s commitment to becoming a global leader in the industry, enhancing both its competitive position and its ability to meet the demands of an evolving market.

Investor Information

Prime Material Recovery's leadership team, including CEO Bernard Schilberg and President/CFO Nate Schilberg, brings a wealth of experience in the non-ferrous metal processing industry. With a clear vision for PMR’s growth, they are committed to leveraging strategic acquisitions to accelerate their expansion plans. Their recent partnership with a bank syndicate, which includes major financial institutions such as HSBC Bank, First Niagara Bank, and Keybank, highlights their focus on securing substantial capital for strategic investments.

The involvement of an experienced financial advisor, CMM, was integral to the negotiation and structuring of this transaction. Their comprehensive knowledge of family-held middle market businesses and adept problem-solving skills provided PMR with crucial support to navigate the complexities surrounding the acquisition of Allied Metal Corporation, ensuring a smooth and beneficial transition.

View of Dealert

Evaluating the acquisition of Allied Metal Corporation, it is clear that this investment holds significant promise for Prime Material Recovery. By tapping into Allied's established networks and expertise in importing non-ferrous metals, PMR is likely to enhance its operational capabilities and market presence substantially. The strategic expansion into Latin America and the Caribbean addresses a critical gap in PMR’s sourcing operations, positioning it advantageously amid increasing global demand for high-quality metals.

This deal also reflects PMR’s commitment to sustainable growth and innovation within the non-ferrous metal sector. As industries increasingly prioritize environmental responsibility and sustainable sourcing practices, PMR’s expanded capabilities will allow it to cater effectively to this evolving market demand.

Moreover, the continuation of the Mosheim family in leadership roles ensures that Allied's established culture and operational strengths will remain intact, fostering stability during the transition. This continuity enhances the potential for long-term success, as the aligned vision between PMR and Allied is likely to foster innovative strategies that can drive further growth.

Overall, this acquisition can be perceived as a strategic and well-timed investment that not only aligns with Prime Material Recovery's growth ambitions but also positions the company favorably within a highly competitive landscape. The long-term benefits derived from enhanced sourcing capabilities and market expansion can ultimately solidify PMR's reputation as a leading global player in the non-ferrous metal industry.

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