NJ Firm To Buy SC Tire Recycling Plant

A New Jersey-based company agreed to pay $3.4 million for a Moncks Corner, S.C., tire-recycling plant that cost about $50 million to build.

But even at that deep discount, the top executive of Recovery Technologies Group is not entirely sure whether his company walked off with a bargain.

"We hope it is," said Martin Sergi, president of RTG, which bought the assets of Santee River Rubber Co. at a court-supervised bankruptcy auction in Charleston.

The sale is set to close by March 1. It includes 28 acres, a 60,000-square-foot recycling facility and all equipment. U.S. Bankruptcy Court Judge John Waites said he would approve RTG's bid.

Sergi estimated that his company would restart the business within three to four months, after it invests up to $1 million in repairs and improvements. The plant would operate under a more modest business plan than the original, he added.

"We're going to tone it down and make it the right size for South Carolina," Sergi said.

Still, RTG plans to experiment with the troubled technology, which comprises about one-third of the plant, to see if it can make it work. "If we can, we'll utilize it," he said. "If not, that part of the operation will be sold, frankly."

Santee River Rubber filed for Chapter 11 bankruptcy protection in October 2000, after a cash-crunch kept the plant from entering full-scale commercial production. At one point the company had up to 70 workers.

Sergi said the tire-recycling industry was skeptical when the company announced plans to process up to 8 million tires a year from Moncks Corner. By building near the coast, the company could only look inland for suppliers.

RTG was the only firm to turn in a legitimate bid for the assets.

A last-minute offer from Arizona-based LandStar Corp. was rejected by bankruptcy trustee and attorney Bill McCarthy, who was in charge of finding a buyer.

Sergi said RTG sells its recycled rubber to companies that make asphalt, automotive bumpers, running tracks and other products. Post and Courier (S.C.)