PITTSBURGH — Metal recycling veteran Daniel Rifkin has strengthened his ties to Industrial Services of America Inc. (ISA) by buying part of its property.
LK Property Investments LLC, owned by Rifkin, chief executive officer of Waterloo, Ind.-based MetalX LLC, has purchased a 4.4-acre parcel from ISA Real Estate LLC for $1 million, according to a regulatory filing.
LK Property will lease the land back to Louisville, Ky.-based ISA for $3,000 per month for five years, and the metal recycler will reimburse LK Property for 40 percent of the property taxes. ISA has an option to vacate the leased premises with 90 days' notice.
ISA revealed in its latest earnings report that it is facing challenges, noting that its auditors doubted it could continue as a going concern due to losses, the violation of a debt covenant and the company’s inability to obtain a waiver of the covenant violation (amm.com, April 16).
Proceeds from the property sale will be applied toward working capital and to reduce debt.
It has been almost a year since Rifkin, through Recycling Capital Partners LLC, took a position in the recycler by purchasing 857,143 shares and a five-year option to purchase an additional 857,143 shares (amm.com, June 16).
The two companies also have a working relationship. In 2014, ISA sold scrap material worth $1.7 million to MetalX, an auto shredding facility.
ISA vice chairman and president Sean Garber said that the deal with Rifkin is positive. “Danny and his team have been very supportive of ISA from the inception of our involvement with the company. This latest transaction further illustrates the growing partnership and our mutual commitment to forge forward on the path for ISA.”
Garber said the company is working to navigate through the tough conditions. “There have been many challenges with ISA as well as the industry as a whole this past year. However, we have faced each one of them with great determination and resolve in order to continue to position ISA for the future,” he said.