PITTSBURGH Less than one week
after the Oct. 26 expiration of a five-year no-compete
agreement, the former owners of scrap recycler OmniSource Corp.
have announced their return to the industry with the
construction of an auto shredder in northeast Indiana.
MetalX, the Rifkin brothers new scrap-processing
facility in Waterloo, Ind., will serve as the flagship
scrapyard once it is complete, one of many they say are in the
The Rifkins sold Fort Wayne, Ind.-based OmniSource to Steel
Dynamics Inc. (SDI), also of Fort Wayne, in 2007 for more than
$1 billion (
amm.com, Oct. 1, 2007), and the three Rifkin
brothers walked out after less than a year when the marriage
apparently soured (
amm.com, June 16, 2008).
"We procured and are building a ferrous and nonferrous
greenfield facility and believe it to be an excellent location
for a regional processing center," said Danny Rifkin, president
and chief executive officer of the new company. "We are
installing a shredding system that can easily be expanded if
inbound (scrap) warrants it."
The company expects to hold a ribbon-cutting ceremony this
month at the 70-acre site, which has mainline rail access, is
adjacent to an interstate and is close to other transportation.
Processing efforts will be phased in starting with nonferrous
baling and shearing, and the shredder is expected to be
commissioned during the first quarter of 2013.
The Rifkins have assembled a team of former OmniSource
executives to springboard its growth platform. Rick and Marty
Rifkin will oversee nonferrous growth efforts, and Dannys
son, Neal, is working at the start-up facility.
Jim Ustion will serve as executive vice president of
marketing and transportation, and John Marynowski will serve in
a board-level position in which he will be active in the
strategic growth of the company. Both men had more than 30
years experience with OmniSource when they left in
Paul Everett will serve as chief financial officer, Jeff
Ryerson will act as vice president of operations and Steve King
has been named vice president of marketing, focusing on
industrial marketing and transportation.
Brian Brown will serve as vice president of engineering and
will be responsible for designing and overseeing the
construction of the shredder. Shari Zink will oversee
"We have assembled a tremendous management team with a lot
of experience and a pretty diverse skill set. We have all
worked together before," Rifkin said.
Rifkin said that Waterloo is near his home and seemed a
logical choice for the first scrapyard, but he expects to add
more assets to the companys portfolio in short order. "We
have identified half a dozen regions in the country where it
appears there is an opportunity for a niche business with a
different strategy," he said. "We thought it best to start in
an area we are familiar with and to restart relationships."
Rifkin said the company expects to complete two acquisitions
in the first half of 2013 and a total of three or four before
the end of next year.
"We can access a lot of mills in this region. When we look
at some other regions we plan to enter, there could be an
opportunity to export," he said.
The companys strategy is return to its scrap roots and
focus on industrial accounts.
"The MetalX strategy is to build a strong business culture
among us and focus on suppliers and generators. We have always
thought the sourcing of scrap is a key element to the
business," Rifkin said. "It appears to us in the industrial and
wholesale sectors that suppliers and generators have been
disregarded a bit. We intend to focus on those relationships,
and think that will differentiate us."