Keywell LLC has hired an investment banker to pursue partners,
financing or equity contributions as the company also suspended
payments at all of its yards for scrap deliveries received
on or before June 26.
The stainless and
specialty steel scrap company confirmed to AMM earlier
this week that it had temporarily closed processing facilities
in Detroit, Atlanta and Chicago due to continued weakness in
scrap demand (
amm.com, July 1).
The company has
subsequently revealed in a letter to suppliers that it will
reduce staff at its operating facilities in West Mifflin, Pa.;
Frewsburg, N.Y.; Falconer, N.Y.; Monroe, N.C.; Indian Trail,
N.C.; Fairless Hills, Pa.; and Carson, Calif.
"While payments for
receipts prior to June 26 are currently suspended, our bank
(Bank of America Corp.) is supportive and cooperating with us,
we have availability on our credit line with BofA and we expect
that payments for all receipts on or after June 26 will be made
according to terms. Any new purchases will also be handled in
this manner," Keywell president and chief executive officer
Mark Lozier said in the letter.
was "reacting swiftly to the recently announced reduction of
chrome/nickel melting at AK Steel (Corp.)s Butler Works
and the ongoing effects of the unprecedented downturn in the
worldwide stainless steel scrap market," it said.
However, a spokesman
for West Chester, Ohio-based AK Steel denied that the company
had reduced its nickel/chrome melting or made any such
announcement. "The plant continues to operate according to its
production schedule," he told AMM.
"are being taken to enable the company to weather the current
economic environment and prepare it for the opportunities
ahead," Lozier said in the letter. "Keywell remains committed
to its customers, supply partners and employees and is taking
these difficult steps in an effort to position itself for
growth when the market recovers."
Demand for stainless
scrap has fallen sharply in recent months, along with pricing,
sources have saida trend that has been exacerbated by the
traditional summer slowdown in business activity (
amm.com, June 18).