Magnetation gets $100 million to speed construction
Grand Rapids-based Magnetation has secured $100 million in new financing to help fast-track construction projects and increase production.
The company announced Friday that it has “completed a $100 million senior secured notes tack-on offering” to raise the capital.
Magnetation has two major projects currently underway — the construction of its fourth iron ore processing plant in Coleraine, and construction of its iron ore pelletizing plant in Reynolds, Ind.
The new cash “will be used to complete its iron ore expansion projects ahead of schedule and finance the increased production capacity of its new iron ore concentrate plant,” the company noted in a statement.
Instead of opening in the first half of 2015, the Reynolds plant, which will use taconite concentrate mined and processed in Minnesota, will open by September.
That plant will employ 100 people making pellets that will be used by Magnetation partner AK Steel’s mills in Middletown, Ohio, and Ashland, Ky.
The Coleraine processing plant, which will employ 120 people, will start making concentrate early in 2015, about six months ahead of schedule.
“We are very pleased with the execution on these projects by our Magnetation team members as well as our suppliers and stakeholders,” Magnetation CEO Larry Lehtinen said in a statement. “We look forward to these projects coming online and sending our first shipment of pellets to our partner and customer AK Steel.”
Magnetation LLC is 51 percent owned by Magnetation Inc. and 49 percent owned by AK Steel Corp. Magnetation has developed a unique process to recover valuable iron ore left behind by long-shuttered iron ore mining operations at several locations across the Iron Range.
In addition to the Coleraine plant now under construction, Magnetation operates plants in Keewatin, Bovey and Chisholm.