NEWBURGH, Ind. (Inside INdiana Business) — Tennessee-based Kaiser Aluminum Corp. (Nasdaq: KALU) announced Thursday it has declared force majeure at its Warrick Rolling Mill in Newburgh. The company says the move is due to the limited availability of magnesium used in the production of some of its aluminum beverage and food packaging products.
Kaiser, which acquired the Warrick Rolling Mill business from Pittsburgh-based Alcoa Corp. (NYSE: AA) in April 2021, says the lack of magnesium has reduced its ability to make the products at this time.
Force majeure is a legal provision in a contract that “frees both parties from obligation if an extraordinary event directly prevents one or both parties from performing,” according to the Legal Information Institute at Cornell Law School.
Kaiser says its largest magnesium supplier, US Magnesium LLC, declared force majeure in September 2021, but continued to supply about 50% of its contractual commitment to Kaiser Warrick. However, the company says deliveries have recently stopped.
“Kaiser Warrick has been unable to immediately source additional magnesium from alternative sources and has begun adjusting production levels based on the amount of magnesium currently available and otherwise scheduled for delivery from other suppliers,” the company said Thursday in a news release. “Kaiser Warrick is working with its customers to minimize the impact on planned deliveries.”
The company says it expects production and deliveries to be reduced by 30% to 40% for July, and approximately 50% during the remainder of the third quarter. Those numbers are based on currently contracted deliveries of magnesium and assuming it will not receive further deliveries from US Mag.
Kaiser Warrick, the company says, will continue to operate at lower production levels until US mag resumes deliveries or another magnesium replacement becomes available.
The company did not specify if any jobs would be affected.
Earlier this month, Alcoa announced it had curtailed one of three operating smelting lines at its Warrick Operations facility due to “operational challenges.” Kaiser says it does not expect Alcoa’s move to affect the current or anticipated output at Kaiser Warrick.
Kaiser says it will provide an update during its second quarter earnings call, which is scheduled for July 26.
In March, Kaiser broke ground on a $150 million addition to its Warrick operation. The project includes a 100,000-square-foot production bay that will house a new coating line and is expected to create 10 jobs.
EVANSVILLE, Ind. (Inside INdiana Business) — The day when interstate motorists can cross the Ohio River from Evansville to Henderson, Kentucky is still about a decade away, however the bi-state project on Wednesday hit a major milestone. Officials from Kentucky and Indiana broke ground on the first phase of the Interstate 69 Ohio River Crossing.
The I-69 ORX project is divided into three sections for construction. Section one focuses on improvements in Henderson and extends from KY 425 to US 60. The Kentucky Transportation Cabinet says work begins this summer and will continue through 2025.
“This is a monumental day,” said Kentucky Governor Andy Beshear. “The I-69 Ohio River Crossing will mean improved travel and increased opportunities in Western Kentucky and beyond. It gives me a lot of pride to proclaim to the people of Western Kentucky that ‘We’re off!’”
Phase two involves construction of a four-lane, tolled bridge over the Ohio River. This is the link that will connect the two states via I-69.
“It’s a great feeling to stand in Henderson today, pick up a shovel and help turn the first dirt on this monumental project,” said Evansville Mayor Lloyd Winnecke. “The I-69 Ohio River Crossing will join our communities in ways not possible before. Interstate connectivity is a gamechanger.”
The ORX project team says bridge design is expected to begin in 2025 with construction anticipated to begin in 2027. It will take about four years to complete that phase of the project.
ORX section three involves construction of the bridge approach in Indiana. That project, being overseen by the Indiana Department of Transportation, is expected to begin 2024.
Motorists currently cross the river via U.S. 41. According to the I-69 ORX website, the southbound bridge will likely be demolished after the I-69 bridge opens. The northbound U.S. 41 bridge will be retained for two-way traffic.
Officials say maintenance costs on the old bridge are high. Indiana and Kentucky say they have spent more than $50 million on maintenance costs on the US 41 bridges since 2005.
Click here to learn more about the project.
EVANSVILLE, Ind. (Inside INdiana Business) — A longtime leader in the economic development community of southern Indiana has announced retirement plans. Greg Wathen, president of the Evansville Regional Economic Partnership, says he will retire this fall after more than 36 years in economic development.
Wathen previously served as president and chief executive officer of the Economic Development Coalition for 14 years until it merged with the Southwest Indiana Chamber and Growth Alliance for Greater Evansville. Together they formed E-REP.
“From day one, my goal for the E-REP merger was to ensure that we collectively laid a solid foundation for the future to build a stronger regional voice, and I believe that process is well under-way,” said Wathen.
Evansville-based Old National Bancorp (Nasdaq: ONB) Chief Executive Officer Jim Ryan says Wathen has been “the driving force behind the scenes resulting in the creation of thousands of new jobs and billions invested in the region.”
E-REP says Wathen has twice been named a top 50 economic developer in North America by Consultant Connect.
NEWBURGH, Ind. (Inside INdiana Business) — California-based Kaiser Aluminum Corp. (Nasdaq: KALU) is making a major investment in its Warrick County operation. Our partners at WEHT-TV report the company will break ground Wednesday on a new $150 million addition at its plant in Newburgh.
The project will include a 100,000-square-foot production bay to house a new coating line totaling 665 feet in length. The station says the project represents the third largest capital investment in Warrick County history.
Kaiser acquired the rolling mill business from Pittsburgh-based Alcoa Corp. (NYSE: AA) one year ago this week. The facility employs more than 1,100 workers and produces about 310,000 metric tons of flat-rolled aluminum each year for the beverage and food packaging industry.
It was not immediately clear if any new jobs would be created as a result of the investment.
Kaiser Aluminum President and Chief Executive Officer Keith Harvey will be among the officials in attendance for the groundbreaking.
NEWBURGH, Ind. (Inside INdiana Business) — Pittsburgh-based Alcoa Corp. (NYSE: AA) has completed the sale of its rolling mill business in Newburgh. The deal with Kaiser Aluminum Corp. (Nasdaq: KALU) in California is valued at $670 million.
Plans for the sale were first announced in December. Officials said when the deal was completed, the plant’s 1,170 would become employees of Kaiser.
As part of the agreement, Alcoa will retain ownership of the smelter and electric generating units at the site, which employ about 660 people. Alcoa will also continue to serve as owner of the property and has entered into a long-term ground lease agreement with Kaiser.
The rolling mill produces some 310,000 metric tons of flat-rolled aluminum each year for the packaging industry. Additionally, Alcoa says it has reached a market-based metal supply agreement and transition services agreement with Kaiser.
EVANSVILLE, Ind. (Inside INdiana Business) — Three economic development organizations in southwest Indiana that say they share a vision for growth and prosperity in the region have merged. The Economic Development Coalition of Southwest Indiana, Growth Alliance for Greater Evansville and Southwest Indiana Chamber will join forces effective April 1.
The unified organization says together it will advance the interests of businesses and fuel economic and community growth in the Evansville region.
“All three organizations have a proud tradition of accomplishment,” said Greg Wathen, President and Chief Executive Officer of the Economic Development Coalition of Southwest Indiana. “By pooling and unifying essential economic development functions into a single structure, we have an opportunity to better serve the region with a bolder vision for the future.”
Wathen will serve as a co-CEO, along with Southwest Indiana Chamber President and CEO Tara Barney, during the transition.
“Having these three organizations recognize that we can be so much more impactful together… aggregated into an organization that can be really well prepared to represent this region, because we’re competing against a big globe out there,” said Barney. “And everything we can do to center ourselves forward with our particular strengths and the secret sauce that makes up our geography.”
In October, the organizations announced their intentions to explore a merger. Since then, the group analyzed the finances, public policies and technology that would be impacted by the strategic integration.
“(It is) a fairly historic vote where we had 120 plus collective members of our boards say ‘yes,’ and I think that speaks volumes to the process that we follow…..as well as trying to address all of the issues that were brought up during the process,” said Wathen.
The organization says under one umbrella, it will simplify the process for companies that want to settle in southwest Indiana to know where to access resources.
“We are very pleased that after months of document review, discussion and best-practice research–including study of similar regions seeking increased velocity–we have clear direction and authorization from our collective boards to aggregate the work, the assets, the staffs, and the expertise of three very sound organizations into one,” said Lynell Walton, Growth Alliance for Greater Evansville Board Chair.
The name and brand of the new organization will be released in April when the merger becomes effective.
ELBERFELD, Ind. (Inside INdiana Business) — A Florida-based food packaging film supplier is expanding its presence in southwest Indiana. Phenix Specialty Films has broken ground on a new technical service hub and distribution center at the North Warrick Industrial Park near Elberfeld and create up to 23 jobs by the end of 2025.
Financial details for the full project were not disclosed. However, a spokesperson for the Warrick County Economic Development Department tells Inside INdiana Business the company is investing about $750,000 in the project’s first phase.
The first phase will include a 10,500-square-foot facility will house a technical center, as well as warehouse and office space. The company says it plans to expand in the future and bring additional jobs.
“We were looking for a site with forward-thinking local leadership, a strong work ethic and a strategic location with good access to interstate transportation,” said Joe Dobinski, managing partner of Phenix Specialty Films. “Warrick County is the perfect fit for the future of our company.”
Phenix also has a facility in Evansville.
The Indiana Economic Development Corp. has offered Phenix up to $400,000 in conditional tax credits, which the company will not be eligible to claim until Hoosier workers are hired for the new jobs.
The news comes about two weeks after Warrick County officials announced work had begun on a 100,000-square-foot shell building at the industrial park.
ELBERFELD, Ind. (Inside INdiana Business) – Construction of a 100,000-square-foot shell building in the North Warrick Industrial Park is underway. The Warrick County Redevelopment Commission, together with Success Warrick County and Newburgh-based Woodward Commercial Realty, held a groundbreaking ceremony Wednesday morning to kick off the project.
The commission says the building is part of a current expansion of business at the industrial park that will bring jobs to northern Warrick County.
“The industrial segment of the real estate market currently has demands for existing high-quality properties easily customized to specific needs and uses,” said Evan Beck, president and managing broker for Woodward Commercial Realty. “The demands are to deliver a finished product in a much shorter timeline than developing a property from scratch to meet the ever-changing global business climate.”
The commission says the surrounding lots also provide space for a future tenant to expand their operations and customize the facility.
“An industrial shell building allows us to responds to companies and projects looking to land in Southwest Indiana immediately as we work to bring projects, investment and quality jobs to our community,” said Steve Roelle, executive director for Warrick County Economic Development.
The industrial park is home to tenants such as North American Lighting and Pepsi.
NEWBURGH, Ind. (Inside INdiana Business) – Newburgh-based Heritage Federal Credit Union has acquired Elberfeld State Bank in Warrick County. The credit union expects to complete the integration of the bank during the first quarter of 2021.
HFCU currently operates nine branches in Vanderburgh, Warrick, and Posey counties and one branch in Kentucky. With the completion of the acquisition, the credit union says it will have 13 locations in the Evansville metro area.
“We are excited for the opportunity to partner with The Elberfeld State Bank to further help our communities grow and flourish,” said David Milligan, chief executive officer of HFCU. “We are truly honored that the Board of Directors and executive officers of the Bank would recommend our institution and our proposed combination to their shareholders. Heritage’s strong consumer loan and mortgage loan business will nicely complement the extensive commercial loan business that the Bank has been so successful in building over the years.”
The credit union says it expects to have combined assets of over $810 million.
Financial details of the acquisition were not disclosed.
EVANSVILLE, Ind. (Inside INdiana Business) – The Economic Development Coalition of Southwest Indiana has created a low-interest loan program to help local small businesses to continue to operate during the COVID-19 pandemic. The Grow Local Lending Fund is designed for businesses that may not have been eligible for other federal loan programs and are located within the four-county southwest Indiana footprint, including Gibson, Posey, Vanderburgh and Warrick counties.
The coalition says it has committed up to $460,000 in small business loans.
The program is a partnership with Illinois-based Banterra Bank, Cynthiana-based Community State Bank of Southwestern Indiana and Evansville-based Old National Bancorp (Nasdaq: ONB).
“Small businesses help to drive Southwest Indiana’s regional economy, and this low-interest loan program can mean the difference for some small businesses reopening,” said Community State Bank of Southwestern Indiana President Steve Bennett.
The coalition says loans will range between $5,000 and $7,500 and can be used for working capital, continued operation expenses or to support remote work expenses.
“We’re excited to partner with the Coalition on this important small business loan program,” said Chris Rutledge, market executive at Banterra Bank. “With so many small businesses challenged during the pandemic, we thought this was an excellent way to help.”
Businesses interested in the program can learn more and apply by clicking here.