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(UPDATE) Aluminum maker, recruiter still at impasse on $1.2 billion project

ASA alloysBy JACK WEATHERLY 

The impasse between American Specialty Alloys and Golden Triangle economic development officials has not eased.

The startup aluminum maker with offices in Columbus that says it will build a $1.2 billion mill — somewhere — is “pulling up stakes” and heading for Alexandria, La., Joe Max Higgins, executive director of Golden Triangle Development LINK, said Tuesday.

That’s unofficial. Nor was there an official response from American Specialty.

» (BREAKING NEWS) American Specialty Alloys won’t locate $1.2B mill in Mississippi

George Riel, chief marketing director for the company, said, “not today,” when asked if that is true.

A call to the Alexandria area economic development agency had not been returned by press time, though typically such deals are kept under wraps till they are announced.

American Specialty Chief Executive Roger Boggs, in a subsequent interview stopped short of announcing the all-important location for the plant, reiterating   confidentiality agreements.

At stake are between 450 and 650 jobs paying on average $85,000 a year at the mill that would produce aluminum alloy for automotive bodies. About 2,000 workers would be needed to build the 1.4-million-square-foot plant.

The journey that has led to this dysfunctional relationship started in March and has been punctuated by highs and lows.

The company issued a detailed press release on Nov. 19, trumpeting its plans. It had opened an office in Columbus, which it still maintains.

Boggs has said that American Specialty has applied for environmental permits in Louisiana, Alabama, Tennessee and Arkansas. It applied for permits with the Mississippi Department of Environmental Quality last fall.

In January, Higgins issued the company an ultimatum: Commit by April 1 to a 826-acre site in the Golden Triangle Industrial Park being held for American Specialty and show a specific plan to the local agency for financing the project or the acreage would be put back on the market.

The company did not respond, and so Higgins says the acreage is up for grabs.

Boggs has said that he has been working directly with the Mississippi Development Authority on the project.

He noted that Golden Triangle Development has not offered “a dime” in incentives. “Otherwise, he probably wouldn’t be talking this way.”

Higgins says he’s seen this kind of pitch before.

A lot of people come to the development agency with ideas, but not money, he said.

The Danieli Group, a major provider of equipment and technological expertise for the mill, sent teams to Mississippi and talked with officials and visited the site, Higgins said.

Boggs described Danieli as a major investor, Higgins said. “Without Danieli, we would’ve viewed this as a guy with an idea. And, believe you me, we get a lot of guys with ideas.”

Bernard Villeman, chairman of the Danieli Corp., sent an email that was not received in time for the print edition deadline.

It reads:

“We never presented our Group as a major investor or minor in the company ASA. Since the beginning of the Project Danieli’s [role] is to provide equipment and technological guidance, with no equity investment.”

The question persists: why no commitment on a site yet?

It’s not a matter of money, Boggs said in a four-way phone call Tuesday.

“We’re oversubscribed,” he said. The challenge is to decide on “the right people and the right money,” and that takes time.

The company is banking on a sea change in the automotive industry, led by Ford’s perennially bestselling F-150 pickup whose 2015 body is aluminum alloy.

Robert D. Smith, recently named chief operating officer for American Specialty who had been the managing director for the Italy-based Danieli Group’s North American operations, said in the conference call with Boggs and Riel that Danieli is not an investor.

Smith said he has “zero doubt”  that the mill will become a reality.

The question remains: where?

Boggs said that Higgins’ public statements have “absolutely” hurt the chances of the mill being built in Columbus.

Higgins paints a picture of American Specialty as a company whose finances are in disarray.

Boggs has secured six-figure loans from local people and has failed to deliver on promises of handsome returns and quick payback, Higgins said.

Boggs said that the company is current with all its payments, though he would not discuss loans, stating that American Specialty has secrecy agreements with its lead investment bank and others.

About five former employees at American Specialty filed for unemployment payments and were told that no money had been withheld from their checks, so they could not qualify for payments, Higgins said.

Boggs said some of its employees were independent contractors and it was up to them to take care of their income taxes.

Also, “we have had some disgruntled employees; we let those people go by mutual consent.”

“We actually gave them a generous severance package. They’re actually still drawing paychecks.”

None of the current 16 employees has missed a paycheck, he said. “We’re actually hiring,” looking for “good engineers and technical folks.”

In addition to Smith, the company has hired a vice president for construction and infrastructure as well as several engineers for the project.

No matter where the plant is built, Boggs said, “we’re a Mississippi company.”

“Are we going to stay in Columbus? Obviously, there are some people who don’t want us to.

“We value our relationship with the local communities and to the state. Being honorable is important to me and our team.

“Wherever the mill is built, we’re going to maintain a Mississippi presence. We’ve committed to our partner companies that we’re going to do business with them no matter where we go.”

“Ultimately, we’re ultimately going to build two or three of these plants. We think the automotive industry is calling for it.”

As he has said several times, Boggs stated that “we are very close” to deciding on a site, no more than a couple of weeks away.

 

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