A private equity firm has committed $5 million in financing to a California-based company with plans to open an automotive plastics recycling operation inside a vacant Sheboygan factory later this year.
Officials from Green EnviroTech Corp. said that the money would provide the company with working capital as it prepares to launch operations here.
The financing agreement, which was announced Monday, calls for Centurion Private Equity to purchase $5 million in Green EnviroTech stock.
CEO Gary DeLaurentiis said the company began its financing push in the last 30 days and has generated plenty of attention due to investor interest in green-tech startups.
“We’re getting an incredible response from the investment community,” DeLaurentiis said. “We’re all pretty happy.”
Green EnviroTech, which is publicly traded, hopes to create about 125 jobs in Sheboygan and will spend $22 million to get its local plant running.
The company’s Sheboygan operations will be housed inside a 288,000-square-foot factory on the city’s north side that International Automotive Components recently closed.
Company officials expect that equipment installations will begin in several months, and the plant will open by the end of the year.
DeLaurentiis said the company plans to hire as many former IAC employees as possible, and hiring should begin in the next two months as the company prepares to take over the IAC building.
The factory will take plastic from shredded cars, remove the contaminants and convert it into high-grade plastic resin and crude oil, which will be sold at below-market rates.
The process will recover significant amounts of contaminated waste that would normally go to a landfill, according to the company.
The 25,000 tons of plastic to be recycled each year will be sent to Sheboygan by Miller Compressing Co., a Milwaukee firm.
The City of Sheboygan has already agreed to issue $25 million in industrial revenue bonds to help finance the project, though the company has since asked the city to increase the bond issue to $30 million.
The city’s participation in the bond issue allows Green EnviroTech to get a lower interest rate, but otherwise the company is responsible for repaying the debt.
Otherwise, the company is not receiving any tax credits from the city — something DeLaurentiis indicated he has no interest in.
“If you’re going to bring jobs to a community, you shouldn’t have to take money out of people’s pockets, and if you can’t build a business without tax credits, you shouldn’t be building a business,” DeLaurentiis said.
The company eventually plans to construct large-scale recycling facilities near automotive shredder locations nationwide, including a facility planned near its headquarters in Riverbank, Calif.
Source : www.sheboyganpress.com