RB Rubber to Acquire Waste Recovery's Portland Tire Processing Plant
27 January 1999
RB Rubber to Acquire Waste Recovery's Portland Tire Processing Plant
MCMINNVILLE, Ore.--Jan. 27, 1999--RB Rubber Products, Inc. today announced that it has agreed to purchase a tire recovery and processing plant in Portland, Oregon, from the Dallas, Texas based Waste Recovery, Inc. (OTC BB:WRII). The transaction is expected to close on or before February 1, 1999."This acquisition puts us in greater control of our raw material supply," said Ron Bogh, president and CEO of RB Rubber. "We have been a Waste Recovery customer for many years; recently they have been the primary source of our lowest cost raw material, tire chips. By taking over the entire tire recycling process, from collecting the waste tires and processing them into tire chips and then crumb rubber, we increase our ability to manage a steady flow of low-cost raw materials. This is critical to regaining our historically strong margins."
RB Rubber intends to initially fund the acquisition through a loan and cash from operations. Long-term, the company plans to execute a sell/lease-back transaction with its bank, as it has done with other major equipment acquisitions. Because of its recycling efforts, RB Rubber is eligible for State of Oregon Business Energy Credits, which it exchanges with the bank for more favorable lease terms.
RB Rubber Products, Inc. is an integrated recycler and manufacturer that transforms scrap tires and rubber into high quality, durable rubber mats, protective surfacing and other rubber products. Applications of the company's products include surfacing for agribusiness, sports and fitness facilities and other commercial and industrial uses. RB is the leader in the black rubber mat market.
Waste Recovery, Inc. is the leading American tire recovery and processing company. It collects and processes waste tires to be sold and used primarily as tire derived fuel (TDF).
This news release contains forward-looking statements that involve a number of risks and uncertainties. Some of the factors that could cause actual results to differ materially, include competitive pressures, increased demand for, or diminished supply of the company's raw materials, and unanticipated difficulties in integrating acquired technologies or businesses. Investors are directed to the company's filings with the Securities and Exchange Commission, including the company's 1997 10-KSB for additional information on the risks and uncertainties as well as other aspects of the company's business.