Scholz has agreed to invest an additional $48.99 million in CMA Corp. Ltd., an Australia-based scrap metal recycling firm.
Scholz, based in Germany, is acquiring 230 million shares of CMA for $.213 a share. The investment follows the German company’s investment of $11.25 million in the company this past November. Combined, the two investments increases Scholz’s holding in CMA to 42.18 percent. The investment is conditional on CMA shareholder approval.
Doug Rowe, CMA’s managing director, said the funds raised through the placement would be used for working capital management and to repay debt.
"We are delighted with the continued support we have received from Scholz," said Rowe.
"Having a company of Scholz’s size and strength is an enormous advantage to us in these very difficult market conditions.
"With the support of Scholz, we will have a significantly strengthened balance sheet and are better positioned for a rebound in growth and profitability in the second half of 2009," he said.
Following completion of the Placement, Scholz will also have the option to take up to 3 positions on CMA’s board.
In addition to Australia, CMA has operations in New Zealand, Asia and the United States. The company is involved in processing and trading of both ferrous and nonferrous metals.