Klöckner & Co Invests in a New Aluminum Processing Facility to Further Accelerate Automotive and Industrial Segments Growth in North America
Rhea-AI Summary
Klöckner & Co announces plans to construct a new aluminum flat-rolled processing facility on the Aluminum Dynamics (ADL) campus in Columbus, Mississippi. The 200,000-square-foot facility will have an annual capacity of 250,000 tons and is scheduled to begin operations in Q4 2026. This strategic investment, executed through subsidiary Kloeckner Metals (KMC), aims to expand the company's higher value-added product portfolio and strengthen its presence in the US and Mexican automotive and industrial markets. The facility will process ADL's energy-efficient, CO2-reduced aluminum products and leverage KMC's network of 55 locations across the US and Mexico.
Positive
- New 200,000-square-foot facility with 250,000 tons annual capacity
- Strategic expansion into higher value-added processing services
- Reduced dependency on steel price volatility
- Integration with existing 55-location network across US and Mexico
- Partnership with Steel Dynamics Inc. strengthens supply chain
Negative
- Significant capital investment required
- Extended timeline until operational (Q4 2026)
- Execution risks associated with facility construction and ramp-up
News Market Reaction – KLKNF
On the day this news was published, KLKNF declined 18.69%, reflecting a significant negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Important step in implementing Klöckner & Co's strategy of expanding its higher value-added product and service portfolio along the value chain for customers
Investment will accelerate the growth of the company's automotive and industrial segments in the important growth markets US and Mexico
New aluminum flat-rolled processing facility on the campus of Aluminum Dynamics LLC in Columbus (MS)
COLUMBUS, MS and DUISBURG, GERMANY / ACCESSWIRE / November 14, 2024 / Klöckner & Co will build a new aluminum flat-rolled processing facility on the campus of Aluminum Dynamics LLC (ADL) in Columbus (MS). The investment is part of the ongoing implementation of the company's strategy whereby Klöckner & Co is consistently expanding its product and service portfolio along the value chain for customers. As part of this strategy, Klöckner & Co intends to broaden its toll processing portfolio to benefit from the profitable higher value-added business and from being significantly less dependent on steel price developments.
Guido Kerkhoff, CEO of Klöckner & Co SE: "Following our acquisitions of National Material of Mexico (NMM) and Industrial Manufacturing Services (IMS) last year, the investment in this new processing facility marks the next chapter in our success story in North America. Thanks to the consistent implementation of our strategy, we will benefit from the future growth in the automotive and industrial segments in the US and Mexico, increase our focus on our higher value-added product and services portfolio and further insulate Klöckner & Co from market price volatility."
The strategic investment, which will be realized through Klöckner's US subsidiary Kloeckner Metals Corporation (KMC), will enable Klöckner & Co to accelerate the growth of its automotive and industrial segment in both important growth markets, the US as well as Mexico. Moreover, the investment will support the long-standing collaboration with ADL's parent company, Steel Dynamics Inc. (SDI).
John Ganem, CEO of Kloeckner Metals Corporation: "Our clear focus on customers' value chains and our portfolio of unique products and services will allow us to accelerate the growth in our automotive and industrial segments. We look forward to realizing our full potential in the North American markets in the years to come."
The new 200,000-square-foot facility has an annual capacity of up to 250,000 tons strategically located to process ADL's energy-efficient, CO 2 -reduced aluminum products. With its on-campus location, KMC will be able to offer highly sustainable, best-in-class aluminum processing solutions, leveraging a hub and spoke model utilizing the 55 locations across the KMC network in the US and Mexico.
The new location, with ramp up planned for Q4 2026, offers room for growth to add additional higher value-added processing services to meet the growing market demand for laser blanking.
About Klöckner&Co:
Klöckner & Co SE is one of the largest producer-independent distributors of steel and metal products and one of the world's leading steel service center companies. With its distribution and service network of around 120 sites, primarily in North America and the "DACH" region (Germany, Austria and Switzerland), Klöckner & Co supplies more than 60,000 customers. Currently, the Group has around 6,500 employees. Klöckner & Co generated sales of some €7.0 billion in fiscal year 2023. With the expansion of its portfolio of CO 2 -reduced materials, services and logistics options under the Nexigen ® umbrella brand, the Company is underscoring its role as a pioneer of a sustainable steel industry. At the same time, Klöckner & Co leads the way in the steel industry's digital transformation and has set itself the target of digitalizing and largely automating its supply and service chain. In this way, the Company aims to develop into the leading one-stop shop for steel, other materials, equipment and processing services in Europe and the Americas.
The shares of Klöckner & Co SE are admitted to trading on the regulated market segment (Regulierter Markt) of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) with further post-admission obligations (Prime Standard). Klöckner & Co shares are listed in the SDAX ® index of Deutsche Börse.
About Kloeckner Metals Corporation:
Kloeckner Metals Corporation (KMC) is a subsidiary of Klöckner & Co headquartered in Roswell, Georgia. It is one of the largest distributors of steel and metal products and one of the leading steel service companies in North America. The company has over 3,100 employees and over 55 branches across the USA and Mexico, generating USD 4.1 billion in revenue in 2023.
KMC is committed to delivering the latest fabrication and processing technologies and the most innovative supply chain solutions to its customers. The company also provides access to electrical steel, aluminum, and stainless steel, especially serving automotive and industrial end markets in North America.
About Steel Dynamics:
Steel Dynamics is one of the largest domestic steel producers and metals recyclers in North America, based on estimated annual steelmaking and metals recycling capability, with facilities located throughout the United States, and in Mexico. Steel Dynamics produces steel products, including hot roll, cold roll, and coated sheet steel, structural steel beams and shapes, rail, engineered special-bar-quality steel, cold finished steel, merchant bar products, specialty steel sections, and steel joists and deck. In addition, the company produces liquid pig iron and processes and sells ferrous and nonferrous scrap.
Contact Klöckner & Co:
Press
Christian Pokropp - Press Spokesperson
Head of Corporate Communications | Head of Group HR
+49 203 307-2050
christian.pokropp@kloeckner.com
Investors
Fabian Joseph
Head of Investor Relations
+49 203 307-2291
fabian.joseph@kloeckner.com
SOURCE: Klöckner & Co SE
View the original press release on accesswire.com
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