SPARTANBURG, S.C., Aug. 2, 2012 (GLOBE NEWSWIRE) -- Synalloy Corporation (Nasdaq:SYNL), a producer of stainless steel pipe, fabricator of stainless and carbon steel piping systems, and producer of specialty chemicals, announces additional information previously reported in a July 16, 2012 press release. On July 27, 2012, its wholly-owned subsidiary, Manufacturers Chemicals, LLC ("MC"), entered into a Master Contract Manufacturing Agreement with Ashland, Inc. ("Ashland") to manufacture a new line of defoamer products.
The initial term of the Agreement is for two years and includes a provision for automatic renewal of the Agreement for successive one year terms.
The project involves technologies that are already basic to MC. After almost a year of product development work, including testing and product costing, Ashland has begun transferring production of 50+ individual products to our facility in Cleveland, Tennessee. These products consist of highly specialized formulations that are sold into a number of sophisticated applications for both industrial and consumer end uses. MC will also produce reaction products that will be used in the final formulated mixtures.
MC made capital investments of approximately $500,000 and increased its production staff by 15% in order to support this new business. We have a long history with Ashland, and prior to executing the contract we made the decision to move forward with a large portion of the required capital expenditures in order to meet the customer's production needs which began in late May. At full production, the new product line has the potential to generate $18 million in annual sales and increase throughput at the Cleveland, Tennessee manufacturing facility by 30% annually.
For more information about Synalloy Corporation, please visit our web site at www.synalloy.com.
Statements included herein that are not historical in nature, are intended to be, and are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by Section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, estimates and projections about our industry, our business, our customer relationships, management's beliefs and assumptions made by management. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict and, in many cases, are beyond the control or knowledge of management. Therefore, actual results may differ materially from those expressed or forecasted in such forward-looking statements. We undertake no obligation to publicly update or revise forward-looking
statements, whether as a result of new information, future events or otherwise. Additional information concerning some of the factors that could cause materially different results is included in our reports on forms 10-K, 10-Q and 8-K filed with the Securities and Exchange Commission. Such reports are available from the Securities and Exchange Commission's public reference facilities and its website, http://www.sec.gov.
CONTACT: Rick Sieradzki at (864) 596-1558