GrafTech Prepares for Return to NYSE
03/22/2018 - Graphite electrode manufacturer GrafTech International is looking to raise upwards of US$100 million through an initial public offering, reports Crain’s Cleveland Business.
Pricing terms were not disclosed, but it intends to trade shares on the New York Stock Exchange under the ticker symbol EAF, the publication said.
In filings with the SEC, the company said there are several factors that make this a good time to return as a public company.
Among those, it said, is a restructuring of the global electrode market.
"We estimate that approximately 20% of industry production capacity (excluding China) has been closed or repurposed since the beginning of 2014. Some of these closed manufacturing facilities have sold off equipment, been demolished, undertaken long-term environmental remediation or been repurposed for other manufacturing uses. Accordingly, we believe the majority of these closures represent permanent reductions," the company said, adding that it itself has shuttered two plants and temporarily idled a third.
"Further affecting the availability of graphite electrodes, supplies of petroleum needle coke and coal tar (or pitch) needle coke, a less favorable substitute for petroleum needle coke, have been limited starting in the second half of 2017. Demand for petroleum needle coke has outpaced supply due to increasing demand for petroleum needle coke in the production of lithium-ion batteries used in electric vehicles. Supply of pitch for pitch needle coke production has fallen as a result of decreasing coke production for the BOF steel industry. These graphite electrode supply constraints have coincided with the recovery in EAF demand for graphite electrodes, resulting in stronger market conditions for our products."
If successful, the IPO would again make GrafTech a publicly traded company after having been acquired by investment firm Brookfield Asset Management in 2015.
In filings with the SEC, the company said there are several factors that make this a good time to return as a public company.
Among those, it said, is a restructuring of the global electrode market.
"We estimate that approximately 20% of industry production capacity (excluding China) has been closed or repurposed since the beginning of 2014. Some of these closed manufacturing facilities have sold off equipment, been demolished, undertaken long-term environmental remediation or been repurposed for other manufacturing uses. Accordingly, we believe the majority of these closures represent permanent reductions," the company said, adding that it itself has shuttered two plants and temporarily idled a third.
"Further affecting the availability of graphite electrodes, supplies of petroleum needle coke and coal tar (or pitch) needle coke, a less favorable substitute for petroleum needle coke, have been limited starting in the second half of 2017. Demand for petroleum needle coke has outpaced supply due to increasing demand for petroleum needle coke in the production of lithium-ion batteries used in electric vehicles. Supply of pitch for pitch needle coke production has fallen as a result of decreasing coke production for the BOF steel industry. These graphite electrode supply constraints have coincided with the recovery in EAF demand for graphite electrodes, resulting in stronger market conditions for our products."
If successful, the IPO would again make GrafTech a publicly traded company after having been acquired by investment firm Brookfield Asset Management in 2015.
