Alcoa Home Exteriors Inc. has acquired Owens Corning's vinyl siding facility in Atlanta. Pittsburgh-based Alcoa announced the move Jan. 21 at the International Builders Show in Las Vegas.
Terms of the deal were not disclosed, but officials expect the transaction to close by April, pending approval by the bankruptcy court. Owens Corning is in the midst of a Chapter 11 reorganization plan.
The move gives Alcoa three vinyl extrusion facilities, including sites in Stuarts Draft, Va.; and Denison, Texas. In a Jan. 21 interview at the builders show, Alcoa President Gary Acinapura discussed the decision.
``Systematically, between Stuarts Draft and Denison, it's a nice, central location,'' Acinapura said. ``The Atlanta market, parts of the Florida market, are a challenge from a price standpoint, so we really needed to have a facility there to be cost-efficient.''
The plant is configured with relatively large extruders to support production of higher-volume products like soffit. According to Plastics News reports, the site hosts seven extrusion lines with 134 employees.
Alcoa has no plans to make any physical plant expansions at the Atlanta location, a 225,000-square-foot site that originally was owned by Fabwel Inc., which Owens Corning acquired in 1997 as part of Fibreboard Corp. The facility was the least profitable site for Toledo, Ohio-based Owens Corning, since it served the manufactured housing sector. The overall manufactured housing sector declined in 2001. That same year, Alcoa itself closed a facility in Princeville, Ill., that manufactured product for that segment.
``We've started on an organic growth strategy,'' Acinapura said of recent decisions that included changing the firm's name. ``It's been very successful. But one of the challenges when you're growing at a rate that's not very easily predicted, you've got to get out in front with capacity. You can't chase demand by following up with capacity. You've got to get out front of it. This move is really an assurance for us and for our customers that we're going to have the capacity to meet their needs.''
In December, Alcoa acquired gable and shutter maker Richwood Building Products, based in Richwood, Ky. Alcoa operates an injection molding facility in Gaffney, S.C., which it is expanding as well.
``We've added a significant number of new products into Gaffney, so it's been an area of product expansion and equipment expansion for the last two years,'' he said, without disclosing the amount of equipment. What he would say, however, is that the machines are large-tonnage. Alcoa has invested ``several million'' into that site during the past couple of years.
When it acquired Richwood, Alcoa gained one 26,000-square-foot facility in Kentucky with 13 injection presses.
``With Richwood, we can take some of that under-utilized capacity, and leverage that as well,'' he said.
Alcoa had 2002 extrusion sales of about $330 million, a number refigured from the estimated $220 million that appeared in Plastics News' most recent pipe, profile and tubing ranking.