Mill Rock Capital Management LP, a growth and operations oriented private investment firm, announced today that its affiliates have made a strategic investment in Venture Metals, LLC and SI Metallics, LLC in partnership with management. In connection with Mill Rock's investment, Venture has acquired Versatile Processing Group, Inc. The transaction combines two leading U.S. metal recycling solutions providers of comparable size to create a platform with annual revenues in excess of $700 million. Further terms were not disclosed. Mill Rock is based in New York and is an affiliate of Stellex Capital Management LP.
Based in Dallas, TX and founded in 1986, Venture is owned and operated by Mike Uhrick,CEO and Mark Chazanow, President. Venture provides high-touch recycling solutions to the industrials, manufacturing, energy and metals sectors and is a supplier of high-quality refined nonferrous and ferrous metals to domestic and international markets. Venture's fully-integrated, end-to-end business model provides customers with a highly differentiated solution for their recycling needs.
Based in Indianapolis, IN and founded in 1995, VPG is an industrial processor of nonferrous metals servicing the copper manufacturing, electric utility and general industries. The company specializes in recycling nonferrous materials, including copper, brass, aluminum, zinc, tin, silicon and nickel products sourced from a diverse base of suppliers, with a particular expertise in difficult-to-process units. Services provided include wire and cable chopping, de-tinning and de-oiling, laboratory analysis, and logistics.
The combined company will operate six processing facilities in Dallas, TX (2); Des Plaines, IL; Houston, TX; Nabb, IN; and Wills Point, TX. This strategic footprint covers the central U.S. manufacturing corridor and is located in close proximity to customers, as well as important port and rail access points. The combined organization will be led by Messrs. Uhrick and Chazanow and the integrated executive teams of both organizations, supported by more than 200 associates. Through the transaction, senior management of both companies invested in partnership with Mill Rock.
"The Venture team and I are excited to join forces with VPG. VPG is a well-respected company with committed associates, a high-quality management team, specialized processing capabilities and robust infrastructure," said Mr. Uhrick. "We are excited about the growth opportunities of the combined platform and the enhanced capabilities it will provide to all our loyal customers."
"Access to Venture's processing capabilities and global consumer reach represents a significant opportunity for VPG's customers. The transaction will allow us to serve them across a fuller range of metals, while allowing them access to our distribution channels worldwide," Mr. Chazanow added.
"We're delighted to partner with Mike Uhrick, Mark Chazanow and two talented teams to combine these highly complementary industry powerhouses," said Wayne Hale, Senior Partner of Mill Rock and Chairman of Venture Metals. "Our common vision is to establish the industry's leading provider of metal recycling solutions offering a full suite of services across geographies, end markets and metals, transforming metal into reusable resources using sustainable practices and advanced technologies."
Demand for metal processing solutions is driven by industrial production activity and customers' desire to increase manufacturing efficiencies by optimizing metal resource collection. Metals can be recycled repeatedly without degrading their properties, and there are financial and regulatory incentives to utilize scrap. The growing complexity of various modern products, their material mix and sustainability requirements has made metal recycling capability increasingly relevant as a source of value.
Sharma Rao, a Senior Principal of Mill Rock, will be joining the company in the role of Executive Vice President of Business Development. Mr. Rao has managed global metal supply chains at GE Aviation and Rolls-Royce, and was most recently the head of Metals and Strategy at Arconic Inc. In addition to Mr. Rao, Wayne Hale, Charles Heskett, Adi Pekmezovic, William Plummer and Christopher Whalen of Mill Rock have joined Venture's board of directors in connection with the transaction.
Houlihan Lokey, Credit Suisse Securities (USA) LLC, Octant Partners and Milbank, Tweed, Hadley & McCloy LLP advised Mill Rock on the transaction. Deloitte Corporate Finance LLC and Locke Lord LLP advised Venture. KeyBanc Capital Markets and Hunton Andrews Kurth LLP advised VPG.
ABOUT VENTURE METALS
Venture Metals, LLC procures, processes and sells nonferrous metal for recycling and remelting purposes and is based in Dallas, TX. Founded in 1986, the company has grown to become a leading provider of industrial recycling solutions. The company offers tailored, turnkey solutions to collect, remove, sort, process and sell recycled metal generated as a by-product of a production process. Building relationships on transparency and trust, Venture is recognized for its high standards of safety, sustainability and quality. Venture operates two processing facilities in Dallas, TX and one in Houston, TX. For more information, please visit www.venturemetalsinc.com.
ABOUT VERSATILE PROCESSING GROUP
Versatile Processing Group is a leading industrial processor of nonferrous and other metals servicing the manufacturing, electric utility and metal recycling industries. VPG is headquartered in Indianapolis, IN and serves customers nationwide from its facilities in Des Plaines, IL; Nabb, IN; and Wills Point, TX. VPG is highly-regarded for its value-added processes, superior customer service and first-rate execution. The company has a particular expertise in difficult-to-process materials, and its specialized capabilities include industrial scale recycling of insulated wire and cable, de-tinning and de-oiling and utility meter recycling. For more information, please visit https://www.vpg-inc.com/.
ABOUT MILL ROCK CAPITAL MANAGEMENT
Mill Rock is a growth and operations oriented private investment firm that invests in well-positioned middle market industrial businesses in North America. Mill Rock is purpose-built to invest in family-owned businesses, owner-operators and founder-led companies across six industry verticals in which the team brings more than 500 years' direct operating experience. Focus sectors include chemicals and materials, industrial distribution, services, metals, transportation and logistics and specialty manufacturing. Mill Rock supports business transformation through a dual-sourcing strategy encompassing majority equity and Activ Capital® – debt, senior equity or hybrid investments which provide business owners value-added financial partnership without relinquishing a controlling stake. Mill Rock is an affiliate of Stellex Capital Management LP.
