Insimbi Alloy Supplies has undergone significant change since its beginnings in 1970. These developments have resulted in a much larger and more diversified group of companies than the founding members could ever have imagined 50 years ago. Insimbi Alloy Supplies has emerged as the name of the division that includes the products and roots from the original company – a supplier of ferrous and non-ferrous alloys to the South African market – and it is this division that is now celebrating 50 years of achievement.
Metallurg South Africa was established in Johannesburg, South Africa in 1970 as a company mining chrome near Rustenburg, North West Province and mining tantalum in Springbok, Northern Cape by Metallurg Inc, a US supplier and producer of specialty metals, alloys, metal-based chemicals and powders. These products included grain refiners, tungsten carbide powders, Ferro Molybdenum, Ferro Titanium and welding powders. They also represented companies who produced products such as inoculants, nodulisers and calcium.
The current Insimbi Alloys Supplies management team includes Executive Director Colin Botha, CEO Ed Liechti and Director Dudley de Beer
The mine in Rustenburg was setup for the supply of chrome ore to the Metallurg plant in Germany. The founders of Metallurg South Africa had pioneered submerged-arc production of both low-carbon and high-carbon ferrochrome in Germany prior to the First World War, turning to South Africa because their Turkish mines grew to be too expensive to operate.
However, South Africa’s low cost of electricity and volumes of local ferrochrome production eventually proved too competitive for Metallurg’s German ferrochrome plant, resulting in a decision by Metallurg South Africa to sell its chrome-mine to a then strongly-ascending Samancor and also to close its tantalum operation that was rendered uneconomic by falling tantalum prices.
After this, the Metallurg group turned its attention to the production and supply of master alloys to the aluminium industry, notably titanium-boron aluminium and strontium aluminium, which refine the grain of aluminium to make it easier to fabricate. At one stage, the Metallurg group was one of only two global producers of these alloys, which were processed at the group’s London & Scandinavian Metals plant in the UK and at the Shield Alloy plant in the US.
The group also produced many alloys, including ferrotitanium, ferro-boron, tungsten carbide, chromium metal and chromium carbide.
Essentially Insimbi’s business revolves around supplying alloys, raw materials and other ancillary products that are critical to the manufacturing process in the various industries
At the time among Metallurg South Africa’s many large master alloy customers were NF Die Casting (now Maxion Wheels) and Hulett Aluminium (now Hulamin). Its tungsten carbide customers included De Beers Industrial (Debex).
Metallurg South Africa also represented Bozel Electro Metallurgie of France, a producer of calcium silicide, calcium silicon manganese, ferro-silicon magnesium, inoculants and silicon metal. In the eighties, group products, together with Bozel products, represented 90% of Metallurg South Africa sales.
In those days the five-person company had single-floor premises in central Johannesburg and rented warehousing in City Deep. The company was also registered as a clearing and forwarding agent with its own shipping division.
Metallurg South Africa – now Insimbi Alloys Supplies – was established in Johannesburg, South Africa in 1970 as a company mining chrome near Rustenburg, North West Province and mining tantalum in Springbok, Northern Cape by Metallurg Inc, a US supplier and producer of specialty metals, alloys, metal-based chemicals and powders. These products included grain refiners, tungsten carbide powders, Ferro Molybdenum, Ferro Titanium and welding powders. They also represented companies who produced products such as inoculants, nodulisers and calcium
To grow, the company diversified into more non-group products from its strong group-product base. At the same time it formulated a plan to put a considerably greater export element into the activities of the company’s in-house shippers and simultaneously achieve optimum organic and acquisitive growth within the company’s Southern African footprint.
In the late eighties, Metallurg South Africa entered the field of bulk alloy supply, acquiring several new local agencies including Rand Carbide’s ferrosilicon agency, Ore & Metal’s ferromanganese and Consolidated Metal Industries’ charge chrome agency, which necessitated moving to a larger warehouse in Wadeville, Gauteng.
In 1992, the company purchased the now fully-paid 7 690m² office and warehouse premises in Crocker Road. Subsequently the company has added a further 3 000m² of office and warehouse space.
In the late nineties, Metallurg South Africa had virtually saturated the market in its role as a metal trader and began seeking production niches. What became patently clear was that induction furnace liners for the foundry industry were wholly imported.
Insimbi Alloys Supplies was the new name chosen for the company after the MBO in 2003
In an import substitution initiative, the company opened negotiations with US-headquartered Allied Mineral Products Inc., a producer of monolithic refractories for the foundry, steel and aluminium industries, and formed a joint venture company – AMETSA (Allied Metallurg South Africa) – in August 1997. Initially the company operated primarily as a sales organisation supplying monolithic refractory products to the South African market manufactured by Allied Mineral Products Inc.
During this period a manufacturing facility was being setup in Wadeville, Johannesburg and the company began supplying locally manufactured product in March 1998. At the time the South African manufacturing plant was only Allied Mineral Products Inc.’s second manufacturing operation to be commissioned outside of the USA. In January 2008 Allied Mineral Products Inc. acquired the remaining 49% shareholding of AMETSA. The name AMETSA was dropped completely and the company was renamed Allied Mineral Products South Africa.
Metallurg South Africa had also built up relationships with many other regional and international partners serving the metallurgical and minerals industry. These include Refratechnik, The Rath group, Drache, Assore and Rand Carbide, Allied Minerals, Philips Kiln Services, Geka, Optic Europe, Injection Alloys, Anglo American Platinum Mines, the Nimag Group and Sasol Carbo-Tar.
MBO in 2003
2003: The year was a big milestone in the company’s history. Management of Metallurg SA entered into a new ownership agreement resulting in a break from Metallurg Inc. The deal was negotiated at the instigation of New York management, who asked South African management to arrange the MBO (Management Buy Out), prompted by heavy losses in the wake of the September 11 attack on the World Trade Centre Twin Towers, which led to the US owner temporarily slumping into chapter-eleven receivership, from which it has since emerged. In the interim Metallurg South Africa was able to re-establish itself as an entity completely independent of the global Metallurg group.
In 1992, the company purchased the now fully-paid 7 690m² office and warehouse premises in Crocker Road, Wadeville. Subsequently the company has added a further 3 000m² of office and warehouse space
The six members of the MBO were Langham Carter, Danny O’Connor, Pieter Schutte (all since retired), Fred Botha, Colin Botha and Eddy Liechti. Besides management RMB Corvest and Tandem Capital were included in the shareholding. Tandem Capital was 61% black-owned and was controlled by a board with a majority of previously disadvantaged individuals.
In its negotiations with New York for the purchase of Metallurg South Africa the MBO team successfully negotiated a reduction in price. This, coupled with the strengthening of the rand, resulted in a considerable saving for the team.
2005: Metallurg melts into Insimbi Alloy Supplies
A clause in the MBO agreement was that the South African company had to change its name within two years. This took place in 2005.
Danny O’Connor, Managing Director at the time, said that: “Insimbi reflects the name of the business as it is today. It is the Zulu word for metal, which is durable and long-lasting. Just as Metallurg has proved itself to be, and Insimbi will continue that tradition.”
Insimbi Alloy Supplies, the original company that led to the formation of Insimbi Industrial Holdings Limited, turns 50 this year and specialises in the supply of industrial consumables to a wide range of markets
“The name was specifically chosen to reflect our pride in our South African roots, signifies our commitment to creating a truly broad-based black empowerment company that offers equal opportunities to all our employees and illustrates our commitment to the social upliftment of all South Africans regardless of race, religion and gender.”
By the time the MBO was consummated the contribution of Metallurg Inc. group products to sales turnover represented only 7%, the 93% arising from non-group products with the bulk of them being sourced in South Africa.
Post MBO, the company was released from having to pay New York a yearly dividend, which formerly cut disruptively into cash-flow. It also allowed the company to start on a further growth and diversification strategy.
Listing on the AltX board of the Johannesburg Stock Exchange
This began in 2008 when the company acquired Future Alloys, a secondary aluminium smelting operation, and changed its name to Insimbi Aluminium Alloys. This was the first of a number of subsequent acquisitions by Insimbi. It had previously acquired Natal Foundry Supplies, its agent and distributor in KwaZulu-Natal, which subsequently changed its name to Metallurg KwaZulu-Natal.
Insimbi Alloy Supplies beneficiates raw materials at its warehouse in Wadeville, Gauteng
In what can be regarded as one of the company’s biggest milestones in its history the company announced that, subject to the achievement of the required spread of public shareholders, the JSE Limited (JSE) had formally approved the listing of 260 000 000 ordinary shares, with a par value of 0.000025 cent each, in the share capital of Insimbi on the Alternative Exchange (AltX) of the JSE from the commencement of trade on Friday, 14 March 2008. The shares were to trade under the abbreviated name Insimbi, with a share code ISB and ISIN ZAE000116828. An amount of up to
R67 275 000.00 before expenses would be raised by Insimbi in terms of the sale of 58 500 000 Insimbi shares at an issue price of between 80 cents and 115 cents per Insimbi share in the private placement.
The next few years would be spent consolidating existing operations and acquiring other companies. In 2009 the company acquired Global Materials in Cape Town including a 4 000m² warehousing and office space. Global Materials had been Insimbi’s representatives in the Western Cape for a number of years.
A further acquisition in the Cape took place in 2010 when the company acquired the entire share capital of Metlite Alloys and Metlite Properties, based in Montague Gardens, Cape Town. At the time the announcement caused the company’s shares to soar 8% on the stock exchange. Metlite had been in operation for more than 20 years and its core business is manufacturing various high-quality aluminium alloys and aluminium de-oxidants.
That same year Insimbi purchased one of the major providers of metal fibre to shotcrete suppliers in Southern Africa’s mining industry Metalloy Fibres, which at the time was part of the Nimag Group of Companies. Insimbi Fibres Division was formed and this was the beginning of the company’s strategy to diversify and move into other industries.
Insimbi Alloy Supplies has the ability to cut to size and guillotine raw material
In 2011 the company launched Insimbi’s Exports Division and also established a new company Insimbi Nano Milling, which is involved in the micronisation of raw materials used as an alternative to titanium dioxide used in the paint and coating industry.
Insimbi Alloy moves from AltX to JSE Mainboard
In 2012 Insimbi migrated to the non-ferrous Industrial Metals sector on the main board of the Johannesburg Stock Exchange under the ticker ISB. The company said the move to the main board would expand its options for raising capital. The listing would open up “exciting opportunities”, said Pieter Schutte Insimbi’s CEO at the time and one of the original executive directors. Schutte had taken over from Danny O’Connor in 2008, when he retired.
With the listing the name of the company was changed to Insimbi Refractory and Alloy Supplies Ltd.
In August 2015 the company announced it had acquired 75 per cent of issued ordinary share capital in Polydrum (Pty) Ltd, which was situated adjacent to the Insimbi campus in Wadeville.
Acquisition of Amalgamated Metals Recycling (AMR)
The next big acquisition took place in 2016 when the company acquired 100% of the AMR Group, as well as the properties from which the AMR Group operated. The business conducted by the AMR Group is that of the aggregation, processing, recycling and sale of scrap metal, for which business is conducted from three facilities on the properties located at Devland, Roodepoort and Booysens in Gauteng. Amalgamated Metals Recycling (Pty) Ltd was founded in 2002 with 40 staff members and has since grown to 230 staff members across the three branches. The purchase price for the AMR Group, and the properties, was for an amount of R284.1 million, of which R234.1 million was payable in cash.
Fred Botha appointed CEO of Insimbi
With the retirement of Pieter Schutte as the CEO in November 2017 the Insimbi Board announced that Commercial and Financial Director Fred Botha was appointed as the new CEO of the company, effective 1 June 2017, and is still the current CEO. Fred Botha is one of the original MBO executive and was also the Group Financial Director since April 2014. In 2018 he would become the CEO of the restructured holding company.
Changes name to Insimbi Industrial Holdings Limited
In 2018 the JSE-listed company increased its stake in the scrap metal recycling industry with the acquisition of Group Wreck for R120 million. Group Wreck is involved in the sourcing, trading and purchasing of scrap, non-ferrous metals in KwaZulu-Natal, South Africa. The rationale for the transaction is to expand the geographic reach of Insimbi’s ferrous and non-ferrous business, expand its client base, and enhance its access to raw material for purposes of beneficiation.
In July 2018 shareholders were informed that the company name change had been approved at the AGM. The name would therefore change from Insimbi Refractory and Alloy Supplies Limited to Insimbi Industrial Holdings Limited.
“As the Insimbi group continues to diversify and follow the multi-dimensional growth of the past few years, it has elected to rebrand to Insimbi Industrial Holdings Limited to fully embrace and reflect the new vision and direction of the company,” the company statement said.
New group structure
Over the years, the core business of Insimbi has expanded and today the company has separate divisions that operate from its Wadeville, Germiston head office, as well as branches in Cape Town and Durban. In addition the group also has three independent manufacturing companies. Ed Liechti now oversees the original core business.
The listed entity Insimbi Industrial Holdings Limited, with Fred Botha as group CEO, oversees the new group structure whereby separate business entities have been created according to markets served and these new business entities are managed by different CEO’s. The entities and CEOs are:
• Amalgamated Metal Recycling – Chris Coombs
• Insimbi Aluminium Alloys – Shaun Green
• Group Wreck – Chris Coombs
• Treppo Group – Mike Oppert
• Insimbi Alloy Supplies – Ed Liechti
Under this structure it oversees the various divisions that include a refractory division that services the steel industry’s refractory requirements, a specialty division that services the welding and optical industries, a steel division that services the steel industry’s raw material requirements, the foundry division that services the foundry industry, the non-ferrous division that services the aluminium industry, the rotary division that services the cement industry’s refractory requirements, the mechanical division that addresses the maintenance needs of primarily, rotary kilns and ancillary equipment in the cement, lime and DRI industry, the powder coating division that services the metals finishing industry, the export division that focuses on the company’s expansion into Africa and the rest of the world and the fibres division that supplies fibre into the construction industry.
Metallurg South Africa’s management team at the time of the MBO in 2003. Standing are Eddie Liechti and Colin Botha, Gary Macdonald (RMB Corvest), Peter Schutte, Fred Botha and Roy Makkink. Seated are Danny O’Connor, Langham Carter and Kerry Hurst (RMB Corvest). Metallurg South Africa partnered with RMB Corvest, the private equity company that assisted in the MBO
Essentially Insimbi’s business revolves around supplying alloys, raw materials and other ancillary products that are critical to the manufacturing process in the various industries. These products are sourced locally and internationally or manufactured by one of the company divisions. For example, the various aluminium products in the form of aluminium pellets, ingots and other shapes.
The current Insimbi Alloys Supplies team, which includes Executive Director Colin Botha and Director Dudley de Beer, has a wealth of experience.
However, with the acquisition of Polydrum (now known as Insimbi Plastics), a manufacturer that specialises in the blow moulding of plastic containers for the chemical, agricultural and food industries, it showed management’s commitment not to be reliant just on the foundry, steel, refractory and cement industries. The added bonus of acquiring this business was the numerous synergies that it has with Insimbi’s existing customer portfolio.
In 2019 Insimbi moved further into scrap metal recycling with the acquisition of the Treppo Group for R109 million.
Insimbi has been a corporate company member of the South African Institute of Foundrymen (SAIF) for many years with various members of its staff at some time serving on the institute’s committee.
For over 30 years the company has sponsored an award at the annual SAIF Awards evening. The award is for a metallurgy student that achieves the highest marks in their first year of study.
For further details contact Insimbi Alloy Supplies on TEL: 011 902 6930 or 011 865 8800 or visit