Chiho-Tiande to acquire Scholz Holding debt

Chiho-Tiande Group Ltd. (CTG), a mixed metals recycling company headquartered in Hong Kong, has announced that it has worked out an agreement with a host of Scholz Group’s secured creditors, making it the largest individual creditor for the Germany-based scrap metal firm.

Throughout the past several quarters, Scholz Group has been taking steps to strengthen its balance sheet and improve its financial position. Recently, the company sold ScholzAlu Stockach GmbH, its aluminum operrations, to a group of investors advised by Orlando Management AG.   

Chiho-Tiande adds that Scholz Holding has accepted the binding offer under a debt purchase agreement at the initial purchase price of €236 million, a 55% discount to the nominal amount of €524 million.

Furthermore, the CTG will provide an additional €20 million  to Scholz, which shall be used to settle the Austrian bond and other payment obligations in connection with the closing conditions under the debt purchase agreement prior to the completion of the transaction.

Following Chiho-Tiande’s announcement, Scholz released a statement noting that the deal is “another key step in the financial restructuring of the Scholz Group.”

Following its agreement to purchase the secured debt, CTG will provide interim funding of up to €50 million to provide Scholz with sufficient liquidity ahead of a planned acquisition of the majority of the equity in the group to create a leading corporation in the worldwide recycling sector.

CTG has confirmed that Essingen in Baden-Württemberg will remain Scholz’s operating headquarters.

Oliver Scholz, CEO of Scholz Holding GmbH, says: “With Chiho-Tiande, we have found a strategic investor whose declared purpose is to become the world’s first fully integrated metal recycler. The planned acquisition of the majority of the Scholz Group with its strong market position in Central and Eastern Europe and North America, and its recognized technical expertise, is a key milestone on the way to achieving this goal. As a part of the CTG Group, I foresee significant growth opportunities and synergistic benefits for Scholz in the coming years.”

In related news, Chiho-Tiande Group has announced changes to its executive committee. The company has named Qin Yongming executive director and a member of the Executive Committee and the Strategy and Investment Committee.

Meanwhile, Zhang Mingjie has tendered his resignation as executive director and member of the Executive Committee and the Strategy and Investment Committee.