Burnham, Illinois-based Scrap Metal Services (SMS) has announced it has entered into an agreement with Great American Capital Partners LLC (GACP), a wholly owned subsidiary of B. Riley Financial Inc., and Wells Fargo Capital Finance, part of Wells Fargo & Co., to provide a $63 million senior secured credit facility. Wells Fargo led the financing, which consists of a $40 million asset-based revolving credit facility provided by Wells Fargo and a $23.27 million term loan facility provided jointly by Wells Fargo and GACP.
SMS is a leading provider of scrap management and brokerage services for ferrous and nonferrous scrap suppliers and consumers. SMS says its decision to move its entire senior credit facility to a new lender is part of its ongoing efforts to ensure its viability in one of the most challenging scrap metal markets in years. Since its formation in 2005, SMS says the company has been able to weather the peaks and valleys in the market through its strategic diversification efforts.
“The SMS management team has achieved a remarkable track record in building and operating companies in the dynamic scrap metals market,” says John Ahn, president of GACP. “Our unique institutional knowledge and familiarity with the company’s asset base—qualifications that differentiated us from other lenders—allowed us to confidently structure and execute this transaction. Overall, our collaboration with this industry leader represents another example of GACP’s proven expertise in helping middle market companies navigate challenging macro environments.”
Jeffry Gertler, co-founder and CEO of SMS, adds, “Our new banking partners offer SMS an increased flexibility to adjust to changing market conditions and what we view as a fundamental shift in the scrap metal industry in the Chicago area. We are making tough decisions and taking the steps necessary to strengthen and potentially expand our position in the market.”
“SMS is a reputable company with a strong management team supporting it,” says Jeremy Baker, managing director of loan originations, Wells Fargo Capital Finance. “We are pleased to have been a part of this transaction and look forward to supporting SMS in their future business endeavors.”
SMS operates scrap processing, steel mill services, ship dismantlement, intermodal/truck/railcar dismantling facilities and auto salvage operations throughout the United States. The company also offers brokerage and trading services to other scrap companies. SMS currently has 23 operations in the U.S. and four operations in Mexico.
SMS is a leading provider of scrap management and brokerage services for ferrous and nonferrous scrap suppliers and consumers. SMS says its decision to move its entire senior credit facility to a new lender is part of its ongoing efforts to ensure its viability in one of the most challenging scrap metal markets in years. Since its formation in 2005, SMS says the company has been able to weather the peaks and valleys in the market through its strategic diversification efforts.
“The SMS management team has achieved a remarkable track record in building and operating companies in the dynamic scrap metals market,” says John Ahn, president of GACP. “Our unique institutional knowledge and familiarity with the company’s asset base—qualifications that differentiated us from other lenders—allowed us to confidently structure and execute this transaction. Overall, our collaboration with this industry leader represents another example of GACP’s proven expertise in helping middle market companies navigate challenging macro environments.”
Jeffry Gertler, co-founder and CEO of SMS, adds, “Our new banking partners offer SMS an increased flexibility to adjust to changing market conditions and what we view as a fundamental shift in the scrap metal industry in the Chicago area. We are making tough decisions and taking the steps necessary to strengthen and potentially expand our position in the market.”
“SMS is a reputable company with a strong management team supporting it,” says Jeremy Baker, managing director of loan originations, Wells Fargo Capital Finance. “We are pleased to have been a part of this transaction and look forward to supporting SMS in their future business endeavors.”
SMS operates scrap processing, steel mill services, ship dismantlement, intermodal/truck/railcar dismantling facilities and auto salvage operations throughout the United States. The company also offers brokerage and trading services to other scrap companies. SMS currently has 23 operations in the U.S. and four operations in Mexico.
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