Facility to be re-purposed into billet manufacturing operation with plans to install a rolling mill.

The GeT Metal Group has announced that it has acquired Naledi Foundry Operations, one of the oldest and largest ferrous foundry operations in South Africa, that was placed in business rescue during April 2022.

“We took over the site at the beginning of May 2023 having purchased the property and all of its movable assets through the business rescue practitioners. I must mention right up front that the BRP was very professional in their dealings and were very skilled in mapping out the plan for the transaction to be successful and reaching out to all the creditors,” said Ebrahim Khan, a Director at GeT Metal Group, the acquiring company.

“Naledi Foundry was an operational entity and there has been theft and vandalism at the facility, which we were aware of, before we entered into negotiations. Outstanding amounts owing to local councils, for example the electricity bill, have been negotiated and settled.”

“We have begun this process with a fresh new approach that also fits into our business plan with the other entities in the group, which we have acquired over the last few years.”

The two ABP OCC-100 10T furnaces

“One of the biggest attractions to us was that the infrastructure of the existing facility is already in place and made the transaction more affordable rather than setting up a greenfield facility. The 60MW on site electrical substation power source is a great benefit and key to our plans going forward.”

Re-purposed into billet manufacturing operation
“It is our intention to initially convert the facility into a billet manufacturing operation, using the existing plant and equipment that is in place. At this stage most of it is not operational because of the theft of critical operating components of the equipment, but this did not deter us. All of this is currently being assessed and decisions will be made soon to get the equipment in processing order as soon as possible.”

“We are to make further investments in the equipment so that they are operational as well as look at re-employing the staff that were there previously if it is viable.”

“For us, besides the power supply, a compelling benefit in our decision making was the three 16 ton BBC melting furnaces and the two ABP OCC-100 10T press pour furnaces as it is our intention to initially re-purpose the facility into a billet manufacturing operation.”

“The term ‘billet’ refers to the form of the metal being produced in the manufacturing process rather than the manufacturing process itself. Billets from the manufacturing process can be divided into two types: Die casting and continuous casting. Continuous cast billet and rectangular billet are mainly made up of low carbon steel.”

“Billets are solid lengths of metal with square or circle cross-sections. They can be made of virtually any type of metal or alloy and to virtually any size to suit the part and production specifications.”

“Billets can later be melted down into manufacturing products and can also be remelted in furnaces or used as feedstock in rolling mill operations.”

“Once they are in their initial form and size, they are generally shaped into the final part form and size through machining methods e.g. CNC machining, which means excess material is removed from the workpiece.”

“Initially we are putting a priority on bringing back into life two of the three 16 ton BBC furnaces while redirecting some of the other assets into the billet casting process. This includes the Georg Fischer automated moulding line.”

“The two ABP OCC-100 10T press pour furnaces have been set up with a single power system and we are busy exploring the possibility of this into a dual power solution. Once the feasibility study is done, we will bring them into immediate operation.”

“This is a significant sequence in our production plans as we are aiming at producing between 10 000 and 15 000 tons of low carbon steel a month with the majority of this product destined to be exported.”

“The Naledi Foundry had seen significant drop-off in volumes and was not operating at optimum levels before its demise. With our approach and management style we will be taking the facility to new levels.”

Time line for Benoni and Atlantis
“Everything is in its early stages but we are looking at the first quarter of 2024 to be operational with billet production at the Naledi Foundry facility. The rolling mill plan will hopefully be implemented to start production in 2025.”

“The Atlantis Forge property where we are planning to also have a mini mill is progressing very positively. Shredders, hammer mills and all the equipment needed for our manufacturing process have been installed.”

“We are still on target to be operational by August/September this year and are looking to produce between 6 000 and 7 500 tons a month.”

“Our ultimate aim is to install a rolling mill and become a mini mill.”

Eclipse Foundry
“Although we will not be producing castings at the Naledi Foundry facility we recently announced that we had acquired the Eclipse Foundry facility in Benoni. This will continue as a foundry at this stage and if we can accommodate castings that were previously produced at Naledi Foundry we will do so, although Eclipse Foundry specialises in low alloy steel and high chromium iron.”

“The Eclipse Foundry facility has a Sinto and a Disa moulding line so we are looking at maximising the capacity.”

Naledi Foundry was a member of the 100% black-owned Naledi Inhlanganiso Group, which includes Naledi Ringrollers. It was one of the largest foundries locally in South Africa. Naledi Foundry was formed when the foundry was purchased from Dorbyl Limited in May 2016. The business manufactured spheroidal graphite and grey iron castings for the automotive, mining and general engineering sectors.

According to the business rescue documents distributed, shareholdings were made up of IDC 65% and Sibusiso Maphatiane 35%. At the commencement date of the business rescue the company employed approximately 211 employees.

“We have no connection at all to the previous owners. We have identified a business opportunity and intend to monetise it as best possible. The current government ban on export scrap metal does aid us in getting regular feedstock and our beneficiation process is adding value to scrap metal before exports. We are also creating employment opportunities both downstream and upstream at the existing and new facilities,” added Khan.

“We have no connection or met the previous owners. All of the negotiations for the purchase of the property and all of its movable assets were conducted through the business rescue practitioner. We have identified a business opportunity and intend to monetise it as best possible. The current government ban on the export of scrap metal does aid us in getting regular feedstock and our beneficiation process is adding value to scrap metal before exports, albeit increase competition as other players are also in full swing to establish their own steel foundry assets. We are also creating employment opportunities, both downstream and upstream at the existing and new facilities,” added Khan.

For further details contact the GeT Metal Group on TEL: 021 853 3086 or visit https://getmetalgroup.co.za