In spite of an industrywide slowdown that has lingered now for nearly five quarters, JW Aluminum in Mt. Holly continues to grow, adding two smaller companies to its corporate portfolio during the month of May alone.
On May 15, the company, which specializes in flat-rolled aluminum products, completed its acquisition of Rollex Aluminum's rolling plant in Jackson, Tenn. The purchase significantly grew JWA's capacity and added 131 employees to its payroll.
Just eight days later, JWA announced it had purchased Coastal Aluminum Rolling Mills Inc., which operates a rolling mill in Williamsport, Pa., and has a diversified product line that includes applications for the aerospace industry.
No terms of these acquisitions have been disclosed, but a spokesman for JWA said they are part and parcel of a strategic plan that's been unfolding since the Lowcountry company itself was acquired by a private equity group, Wellspring Capital Management, in 2003.
Just months later, in April 2004, the company began its steady march toward growth and diversification with the purchase of two foil rolling plants in St. Louis, Mo., and Russellville, Ark.
'What's happening is we're buying small companies with which there are synergies that we believe we can capitalize on within our business model,' said Sammy Peek, JWA's director of marketing.
Dispensing of the 'bizspeak,' Peek quickly added that in many respects the acquired companies are reminiscent in terms of size and scale to what JWA was at its founding 28 years ago.
'Just as important as what we have in common, the different facets these businesses bring to our company has allowed us to diversify and grow in niche markets at a time when many in the aluminum industry are saying it's a time to exercise caution,' he said. 'As a result, we've managed to meet or exceed our budget projections while our competitors are struggling.'
JWA was founded in 1979 as Jim Walter Metals, a division of Jim Walter Corp. The company initially produced cast aluminum coils for use in construction and home building applications and has since grown into a 400-employee producer of high-quality light gauge sheet, foil and coated aluminum products shipped to markets worldwide.
In recent years, competition in the industry has been brutal, due primarily to a surge in aluminum production in China and Vietnam. As a result of that competition, the U.S. industry has been defined mostly by consolidation and acquisition.
Right now, for instance, Alcoa, which also has a facility in Mt. Holly, is in the midst of a hostile $27 billion takeover bid of Canadian aluminum producer Alcan
'Alcoa and Alcan are our competitors and are the brand names everybody knows, but a lot of their focus is in the market of canned stock and household aluminum foil, the kind of thing big, integrated companies have done for years,' Peek said.
'We're trying to build on something different here, serving niche markets as something more akin to a job shop.'
JWA currently supplies nearly 350 million pounds of light gauge sheet aluminum to a variety of end users. One of the biggest is the heating, ventilation and air conditioning industry.
'That's long been our forte, especially out of our Mount Holly facility, which is either No.1 or No. 2 in the market, depending on the time of year,' Peek said
'We also supply quite a bit of aluminum to the transportation market, to the building and construction markets and to the printing industry. Our earliest acquisition also allowed us to enter the highly lucrative flexible packaging market, which gets us into the soft drink, push-through blister pack and chewing gum markets.'
Regardless of the acquisitions, Peek doesn't expect the company to experience a growth spurt here in the Lowcountry, mainly because its current facility is land locked and doesn't have room to grow, he said.
While the company did announce last year that it intends to build a $5 million smelting operation adja
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