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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report: May 16, 1997
(Date of earliest event reported)
METAL MANAGEMENT, INC.
(Exact name of registrant as specified in the charter)
Delaware 0-14836
(State or other jurisdiction (Commission File No.) 94-2835068
of incorporation) (IRS Employer
Identification No.)
500 Dearborn Street, Suite 405
Chicago, Illinois 60610
(Address of Principal Executive Offices)
(312) 645-0700
Registrant's telephone number including area code)
N/A
(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
On May 19, 1997 Metal Management, Inc. (NASDAQ symbol-MTLM) (the
"Company") announced that the Company and Cozzi Iron & Metal, Inc. ("Cozzi")
have signed a definitive Agreement and Plan of Merger pursuant to which Cozzi
will become a wholly-owned subsidiary of the Company. The transaction will
include Cozzi's interests in two joint ventures.
The merger will create a scrap metal recycling company with estimated
annualized gross revenues of more than $500 million. Both companies are
headquartered in Chicago and represent the rapidly changing face of the scrap
metal recycling industry. Metal Management is a year-old company pursuing a
consolidation of the industry and Cozzi is one of the premiere,
long-established family-owned scrap metal recycling businesses in the United
States.
Cozzi has few peers in the industry. Recently ISO 9002 certified, the
company processed over 1.5 million tons of ferrous scrap in 1996 through its
operations in Illinois, Indiana and Pennsylvania. Metal Management owns
Reserve Iron & Metal L.P. of Cleveland, a major ferrous scrap processor, the
MacLeod Group of Companies in Los Angeles, a major wire chopper and processor,
HouTex Metals Company, a significant supplier of ferrous metals to minimills,
which is located on the Houston Ship Channel, and EMCO Recycling of Phoenix,
one of the largest scrap metal recyclers in Arizona.
At the closing of the Cozzi merger, which is subject to a number of
conditions, including approval by the Company's shareholders, the shareholders
of Cozzi will receive 11.5 million shares of the Company's common stock and $6
million in cash. Further, at the effective time of the merger, brothers Albert
and Frank Cozzi will join Metal Management's senior executive team and its
Board of Directors. Albert Cozzi will serve as President and the Chief
Operating Officer of the merged company, T. Benjamin Jennings will remain
Chairman of the Board and Chief Development Officer, and Gerard M. Jacobs will
remain the Chief Executive Officer of the merged company. Frank Cozzi will
serve as Vice President of the Company and as President of the Cozzi
operations.
At the closing, Albert, Frank and Greg Cozzi, as well as T. Benjamin
Jennings and Gerard M. Jacobs, will enter into five-year employment agreements
which will, among other things, grant warrants to purchase an aggregate of
3,000,000 shares of the Company's common stock. Half of the warrants issued
will be exercisable at $5.91 per share and the other half will be exercisable
at a price equal to 75% of the stock's closing price on the day before the
closing of the Cozzi merger.
In addition, Albert, Frank and Greg Cozzi and T. Benjamin Jennings and
Gerard M. Jacobs will enter into a ten-year agreement to, among other things,
vote their respective shares in a common fashion in regard to elections of
directors and in certain other circumstances. When the Cozzi merger is
completed, these five individuals will own, directly or indirectly,
approximately 16 million shares of the Company's common stock on a
fully-diluted basis. Giving effect to the Cozzi merger, as of today, the
Company would have approximately 30 million shares of common stock on a
fully-diluted basis.
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According to Al Cozzi, the two companies combined will control in excess
of 225,000 tons of ferrous scrap per month, in addition to a significant
non-ferrous business. "The trend toward consolidation is fueled by mill
consumers demanding to receive support on a larger scale, and on a direct basis
from the quality suppliers," he said. "The dynamics between the two companies
are quite complimentary, Cozzi Iron & Metal has seven operations on the water
in addition to Metal Management's two deep water facilities, which will
complement our international trading efforts."
Company officials said both parties in the Cozzi transaction expect the
merger to close in the summer of 1997. The closing of the transaction is
subject to, among other things, successful completion of due diligence,
completion of certain additional documents, obtaining regulatory and corporate
approvals, the Company's obtaining of necessary financing, and other customary
conditions. In addition, the Cozzi merger is subject to approval of the
Company's stockholders.
All of the statements in this Form 8-K, other than historical facts, are
forward-looking statements made in reliance upon the Safe Harbor Provisions of
the Private Securities Litigation Reform Act of 1995. As such, they involve
risks and uncertainties and are subject to change at any time. These
statements reflect the Company's current expectations regarding the future
profitability of the Company and its subsidiaries and the benefits to be
derived from the Company's execution of the Company's industry consolidation
strategy. There can be no assurance that the Company's actual future
performance or that of its subsidiaries will meet the Company's expectations
for growth and profitability. In addition, there are no assurances that the
transaction referred to in this Form 8-K will be completed. The statements in
this Form 8-K involve known and unknown risks, uncertainties, and other factors
which may cause actual results, performance, or achievements to be materially
different from any future results, performance, or achievements expressed or
implied by these forward-looking statements. As discussed in the Company's
quarterly report for the period ended December 31, 1996, some of the factors
which could affect the Company's performance include, among other things:
possible inability to replace short term financing with longer term capital
commitments, ability to obtain capital through debt and/or equity placements
sufficient to fund cash requirements under acquisition and merger agreements,
risk of expansion strategy, cyclicality of operating results, price
fluctuations, existing and future debt of the Company, competition in the scrap
metal industry, immediate and future capital requirements, substantial
leverage, reliance on management and principal stockholders, and environmental
matters.
Exhibits
99 Additional Exhibits
1) Press Release dated May 19, 1997
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
METAL MANAGEMENT, INC.
Dated June 2, 1997 By: /s/ Gerard M. Jacobs
------------------------------
Gerard M. Jacobs,
President and Chief Executive Officer
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Ex 99.1
Exhibit No. 1
FOR IMMEDIATE RELEASE
FOR MORE INFORMATION CONTACT:
CONTACT: Xavier Hermosillo, Corporate Communications and
Investor Relations (310) 832-2999
METAL MANAGEMENT ANNOUNCES DEFINITIVE
AGREEMENT TO MERGE WITH COZZI IRON & METAL
Chicago, IL - May 19, 1997 Metal Management, Inc. (NASDAQ symbol-MTLM) (the
"Company") today announced that the Company and Cozzi Iron & Metal, Inc.
("Cozzi") have signed a definitive Agreement and Plan of Merger pursuant to
which Cozzi will become a wholly-owned subsidiary of the Company. The
transaction will include Cozzi's interests in two joint ventures.
The merger will create a scrap metal recycling company with estimated
annualized gross revenues of more than $500 million. Both companies are
headquartered in Chicago and represent the rapidly changing face of the scrap
metal recycling industry. Metal Management is a year-old company pursuing a
consolidation of the industry and Cozzi is one of the premiere,
long-established family-owned scrap metal recycling businesses in the United
States.
Cozzi has few peers in the industry. Recently ISO 9002 certified, the company
processed over 1.5 million tons of ferrous scrap in 1996 through its operations
in Illinois, Indiana and Pennsylvania. Metal Management owns Reserve Iron &
Metal L.P. of Cleveland, a major ferrous scrap processor, the MacLeod Group of
Companies in Los Angeles, a major wire chopper and processor, HouTex Metals
Company, a significant supplier of ferrous metals to minimills, which is
located on the Houston Ship Channel, and EMCO Recycling of Phoenix, one of the
largest scrap metal recyclers in Arizona.
At the closing of the Cozzi merger, which is subject to a number of conditions,
including approval by the Company's shareholders, the shareholders of Cozzi
will receive 11.5 million shares of the Company's common stock and $6 million
in cash. Further, at the effective time of the merger, brothers Albert and
Frank Cozzi will join Metal Management's senior executive team and its Board of
Directors. Albert Cozzi will serve as President and the Chief Operating
Officer of the merged company, T. Benjamin Jennings will remain Chairman of the
Board and Chief Development Officer, and Gerard M. Jacobs will remain the Chief
Executive Officer of the merged company. Frank Cozzi will serve as Vice
President of the Company and as President of the Cozzi operations.
At the closing, Albert, Frank and Greg Cozzi, as well as T. Benjamin Jennings
and Gerard M. Jacobs, will enter into five-year employment agreements which
will, among other things, grant warrants to purchase an aggregate of 3,000,000
shares of the Company's common stock. Half of
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the warrants issued will be exercisable at $5.91 per share and the other
half will be exercisable at a price equal to 75% of the stock's closing price
on the day before the closing of the Cozzi merger.
In addition, Albert, Frank and Greg Cozzi and T. Benjamin Jennings and Gerard
M. Jacobs will enter into a ten-year agreement to, among other things, vote
their respective shares in a common fashion in regard to elections of directors
and in certain other circumstances. When the Cozzi merger is completed, these
five individuals will own, directly or indirectly, approximately 16 million
shares of the Company's common stock on a fully-diluted basis. Giving effect
to the Cozzi merger, as of today the Company would have approximately 30
million shares of common stock on a fully-diluted basis.
"Frank and I intend to help build a combined Metal Management and Cozzi Iron &
Metal into the significant leader of the scrap metal recycling industry," said
Albert Cozzi. "We bring over 50 years of operational expertise, a significant
operating company and a seasoned and proven management team to this merger.
Metal Management is an exciting new public company with the right vision for
the future of the scrap metal recycling industry."
T. Benjamin Jennings, Metal Management's Chairman of the Board said, "The
combination of Cozzi Iron & Metal and Metal Management, Inc. creates a
substantial force in the metal recycling industry. We are excited about the
operational expertise and the significant synergies between our existing
operations. This increases our ability to combine greater access to capital
with a focused national company and generate greater shareholder value."
Gerard M. Jacobs, Metal Management's Chief Executive Officer, said, "The
importance of this merger to Metal Management cannot be overstated. Albert and
Frank Cozzi have tremendous stature, relationships and integrity, that will
help Metal Management reach the next level in consolidating the scrap metal
recycling industry. Ben Jennings and I are very happy to have the Cozzis as
our partners."
According to Al Cozzi, the two companies combined will control in excess of
225,000 tons of ferrous scrap per month, in addition to a significant
non-ferrous business. "The trend toward consolidation is fueled by mill
consumers demanding to receive support on a larger scale, and on a direct basis
from the quality suppliers," he said. "The dynamics between the two companies
are quite complimentary, Cozzi Iron & Metal has seven operations on the water
in addition to Metal Management's two deep water facilities, which will
complement our international trading efforts."
Company officials said both parties in the Cozzi transaction expect the merger
to close in the summer of 1997. The closing of the transaction is subject to,
among other things, successful completion of due diligence, completion of
certain additional documents, obtaining regulatory and corporate approvals, the
Company's obtaining of necessary financing, and other customary conditions. In
addition, the Cozzi merger is subject to approval of the Company's
stockholders.
All of the statements in this release, other than historical facts, are
forward-looking statements made in reliance upon the Safe Harbor Provisions of
the Private Securities Litigation Reform Act of 1995.
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As such, they involve risks and uncertainties and are subject to change at
any time. These statements reflect the Company's current expectations
regarding the future profitability of the Company and its subsidiaries and the
benefits to be derived from the Company's execution of the Company's industry
consolidation strategy. There can be no assurance that the Company's actual
future performance or that of its subsidiaries will meet the Company's
expectations for growth and profitability. In addition, there are no
assurances that the transaction referred to in this release will be completed.
The statements in this release involve known and unknown risks, uncertainties,
and other factors which may cause actual results, performance, or achievements
to be materially different from any future results, performance, or
achievements expressed or implied by these forward-looking statements. As
discussed in the Company's quarterly report for the period ended December 31,
1996, some of the factors which could affect the Company's performance include,
among other things: possible inability to replace short term financing with
longer term capital commitments, ability to obtain capital through debt and/or
equity placements sufficient to fund cash requirements under acquisition and
merger agreements, risk of expansion strategy, cyclicality of operating
results, price fluctuations, existing and future debt of the Company,
competition in the scrap metal industry, immediate and future capital
requirements, substantial leverage, reliance on management and principal
stockholders, and environmental matters.
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