SPARTANBURG, S.C., Aug. 29, 2013 (GLOBE NEWSWIRE) -- Synalloy Corporation (Nasdaq:SYNL), a growth oriented company that engages in a number of diverse business activities including the production of stainless steel pipe, fiberglass and steel storage tanks, specialty chemicals and fabrication of stainless and carbon piping systems, announces the acquisition of the business assets of Color Resources, LLC ("CRI") and the building and land located in Fountain Inn, South Carolina where CRI was the sole tenant (the "CRI Facility"). CRI Tolling, LLC ("CRI Tolling"), a South Carolina limited liability company and wholly-owned subsidiary of Synalloy, will continue CRI's business as that of a toll manufacturer that provides outside manufacturing resources to global and regional chemical companies. CRI Tolling will operate as a division of Synalloy's Specialty Chemicals Segment, which includes Manufacturers Chemicals ("MC"). MC is one of the largest custom chemical formulators and contract manufacturers in the United States. Its principal products include defoamers, surfactants and lubricants, which are used in multiple markets including paper, carpet, textile, metal working, household, industrial and institutional chemicals, petroleum, mining, latex adhesives and agriculture.
On August 9, 2013, Synalloy closed on the purchase of the CRI Facility. Built in 1994 specifically for CRI, the plant includes approximately 135,000 square feet of production, warehouse, laboratory and office space. The purchase price for the CRI Facility was $3.45 million.
On August 26, 2013, Synalloy acquired certain assets and assumed certain operating liabilities of CRI through CRI Tolling. The assets purchased from CRI included equipment and certain other assets and approximately $387,000 worth of inventory and accounts receivables, net of assumed payables. The total purchase price was $1.1 million.The Company funded this transaction by entering into a new term loan with Branch Banking and Trust Company ("BB&T"). The term loan is based upon 85% of the appraised value of the real estate collateral and 75% of the purchase price of the equipment assets. The term loan has a 10-year maturity and the monthly payments will be customized to account for a 20-year amortization of the real estate assets and 5-year amortization of the equipment assets purchased. The interest rate on the term loan is LIBOR based. In order to mitigate the variability of the interest rate risk, Synalloy will enter into a derivative/swap contract with BB&T for the life of the term loan.
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