HANNIBAL - Niagara Worldwide LLC has won the rights to purchase the assets of the idled Ormet Corp. for $25.25 million during a private auction.
Eric J. Spirtas, president of Niagara Worldwide, said his company purchased all assets, including the buildings, property and equipment.
Niagara Worldwide is based in Niagara, Wis., and acquires, markets, manages and sells idle industrial properties and assets. The company acquires properties like Ormet and determines a plan and feasibility of enacting that plan before finding partners and investors.
Everything on the property of the shuttered Ormet mill in Hannibal has been sold to Niagara Worldwide, a Wisconsin company, at auction for $25.25 million.
While he stressed there is still much work to be done to find the right plan for the Ormet property and assets, Spirtas said the key will be getting jobs back in the area.
"It's too early for speculation, and we're not magic," he said. "We're business people trying to figure out how to convert on good people, good property and a good region."
Spirtas cited the strong workforce and resources in the Ohio Valley as reasons Ormet was an attractive purchase. He said he has visited the plant several times, and it is no secret as to why the plant was once successful.
* 1956: Ormet Corp. organized by Olin Corp. and Revere Copper and Brass Inc.
* 1958: Ormet's Hannibal Reduction Plant begins making aluminum. Ormet opens the Burnside Bulk Marine Terminal Division.
* 1974: Consolidated Aluminum Corp. acquires Olin's interest in Ormet and assumes 66 percent ownership, with Revere owning 34 percent.
* 1986: New owner purchases what is now Ormet Primary Aluminum Corp.
* 1996: Ormet purchases 13 miles of railroad track between Powhatan Point and its Hannibal Rolling Mill.
* 2001: The last anode is produced at the carbon plant in Hannibal. The company begins buying anodes from overseas suppliers.
* January 2004: Ormet files for Chapter 11 bankruptcy protection.
* November 2004: United Steelworkers Local 5724 members at the reduction plant go on strike.
* April 2005: Ormet exits bankruptcy. Former creditors, led by Matlin Patterson Asset Management, become shareholders of the company under the reorganization.
* December 2005: The rolling mill closes, placing about 600 union and non-union employees out of work, even as the 500 union members were still on strike.
* 2006: Turnaround specialist Ken Campbell is named interim CEO. USWA ratifies contract. Ormet obtains new power agreement with American Electric Power to allow it to restart its smelter.
* 2007: New executive management is put in place with Mike Tanchuk as CEO and James Burns Riley as chief financial officer. Former rolling mill property sold.
* 2009: Fears grow that Ormet may shut down all six of its potlines due to a disruption in the worldwide supply of alumina. However, the company ultimately decided to keep at least four of the lines going before eventually restarting all six when the alumina supply issue ended.
* July 2012: A Worker Adjustment and Retraining Notification Act notice showed Ormet prepared to cut as many as 837 hourly and 161 salaried positions by the end of the year because of increasing electricity bills. However, the Public Utilities Commission of Ohio offers the company a temporary reprieve.
* February 2013: Ormet files for Chapter 11 bankruptcy.
* Spring/Summer 2013: As production and employment levels vary, Ormet has hearings before the PUCO regarding AEP rates. Minnesota-based Wayzata Investment Partners announces plans to purchase the smelter for about $221 million, provided Ormet can receive these power discounts.
* Oct. 4, 2013: After the PUCO provides Ormet a discounted power rate, but not as significant as the one the company sought, Ormet shuts down the smelter. This immediately placed about 900 workers in the unemployment line.
* Late 2013/early 2014: Ormet sells off raw materials required to make aluminum.
* February 2014: Officials with the bankrupt company announce intentions to sell the entire smelter.
* June 2014: Ormet is sold at auction for $25.25 million to Niagara Worldwide LLC.
"It is a fantastic region, and it has incredible resources, which is why for 60 years they've had a plant there," he said.
Additionally, Spirtas said Ormet has the facilities, terminal assets and manufacturing capabilities to be successful. While there is no guarantee the plant will operate as it once did, Spirtas said his company will work to find the best use for the newly-acquired assets.
"With the great labor base out there, somehow, some way, we want to find something that benefits everyone down the road," he said.
Earlier this week, court documents filed in U.S. Bankruptcy Court for the District of Delaware by Hannibal Real Estate and Artco included an objection to a prospective sale of Ormet.
The filing followed word of a potential $15.25 million sale to CCP ORMT Acquisition, a "stalking horse" bidder for the property. Such bidders are used to discourage low-ball offers in the sales of troubled companies by setting a minimum price.
Hannibal Real Estate purchased the former rolling mill property from Ormet in 2007, while Artco operates a heavy plate steel service center and a steel fabrication center on the 122-acre site. The real estate firm opposed the sale because of an ownership dispute over six mooring cells located in the Ohio River immediately offshore from its property, as well as two water intakes.
Additional details of the sale to Niagara, including the number of potential bidders during the auction, were unavailable. Spirtas directed questions to the auction group.
However, he said the company must now determine what can be done with the idled plant.
"Just like anything, you look at things and determine the scale of the project," he said. "We buy idle businesses and buildings and try to redevelop and right the ship. We're doing our best to find that right next step."
Ohio Rep. Jack Cera, D-Bellaire, who expressed concern over the reported $15.25 million offer from CCP ORMT Acquisition earlier this week, said he spoke to United Steelworkers representatives about the sale and offered to help in setting up meetings with Niagara officials.
"We'll see if there's anything we can do and get to where we can possibly restart," Cera said. "It's a long road to go."
However, Cera was optimistic about the purchase.
"They're willing to give it a little bit of time and to see what can happen," he said. "I'll offer them any help I can give in trying to find somebody (to invest)."
Spirtas said he and other company officials will meet with local officials and workers to formulate a plan. He said as is the case with many new acquisitions, the company will set up offices in Hannibal.
"We are open to listen to people's insights and input and to give them an opportunity to speak up and offer ideas," he said.
Although he acknowledged the challenges the project presents, Spirtas is also optimistic about the purchase. He said past experience will be valuable in finding a plan for Ormet.
"There is no quick fix," he said. "But we have dealt in and around industrial areas and sectors and done the repurpose and fought that battle, and this is not much different."