ASHLAND, Ky. (KT) – Braidy Industries has received interest from investors for more than $1 billion, according to the company’s chief financial officer, and he added those investors eventually chosen will be “the best partners for northeast Kentucky.”
“Leading the rebuild of Appalachia with both advance manufacturing technology and determination is an endeavor that resonates with the investment community,” said Braidy CFO Julio Ramirez in a release.
A $1.68 billion aluminum rolling mill will be built in the EastPark Industrial Park near Ashland with a scheduled opening date in 2020. It will bring in more than 1,000 construction jobs and 600 high-paying fulltime positions once the mill opens. It has become a key component in rebuilding the economy of northeastern Kentucky and the Appalachian region with other companies expected to come alongside Braidy Industries.
The company said in a release it raised the maximum equity funding limit for its current issuance on the Netcapital portal to $500 million and concurrently extended its offering window to Dec. 31, 2018.
Braidy is raising equity through a traditional private placement targeted at large, sophisticated institutional investors up to $500 million while smaller exempt offerings of up to $1.07 million are allowed for Main Street investors, the release said.
Braidy hopes to acquire the minimum 300 shareholders required as a perquisite to potentially list on the NASDAQ in 2019, according to the release.
“We hope to have our equity partners chosen and working together by year-end,” Ramirez said.
Kentucky Power’s plan to supply electricity to the Braidy Industries Atlas mill was detailed in an October filing with the Kentucky Public Service Commission.
A request by Kentucky Power to run a 138 kilovolt transmission line to the EastPark Industrial Park to feed Braidy's planned plant led the PSC to issue a conditional Certificate of Public Convenience and Necessity for the project.
The permit is conditional pending "reasonable assurance in writing from Braidy Industries that sufficient financing has been secured to complete construction of its planned facility." The certificate will not be conditional once Kentucky Power files with the PSC correspondence of a written statement from Braidy providing assurance of financing.
Several media reports published Monday said the plan to power Braidy was delayed, pending proof of financing. Andrew Melnykovych, a spokesman with the Public Service Commission, said that is incorrect.
“Nothing is on hold,” he told The Daily Independent in Ashland.
Kentucky Power's Allison Barker said several months ago Braidy signed a letter of commitment for $3 million to cover preconstruction work on the power project.
"It basically holds Kentucky Power customers harmless in the unlikely event that Braidy does not complete the mill project," Barker said. "We don't anticipate that at all. We've only spent about half of that $3 million on preliminary engineering studies and work and right-of-way acquisition."
Jaunique Sealey, executive vice president of business development for Braidy Industries, said in a statement: "The PSC order is in the ordinary course of our ongoing work with Kentucky Power to upgrade the power delivery lines to our EastPark property in anticipation of the need for increased power supply to support manufacturing operations. We remain on critical path for each of our three companies, Braidy Atlas, Veloxint and NanoAl."
The order from the PSC said the estimated peak load for the proposed Braidy Industries facility is 90 MW. Kentucky Power told the PSC the existing transmission and distribution system in the area cannot support the additional load and there are no other reasonable electrical alternatives.
"Kentucky Power anticipates commencing work, subject to the grant of the CPCN, in the first quarter of 2019," the order said. "The anticipated in-service date for the project is June 2020."
The order said Kentucky Power conducted 11 studies in developing a route for the proposed transmission line. The centerline of the new route crosses parcels owned by 11 landowners. No property owners have opposed the project.
In a Facebook post on Monday night, CEO Craig T. Bouchard said the company has a strong relationship with Kentucky Power. “They are doing a great job. The power commission just granted us a conditional approval to build a miles-long transmission line in the middle of 2019.”
Kentucky Power estimates cost of the project at $22.4 million.
Kentucky Power projected annual operating cost of approximately $7,000 for general maintenance and inspection and annual additional ad valorem taxes resulting from the project of approximately $158,000.
In its order the commission said the permit "should be conditioned upon Kentucky Power's receipt of reasonable assurance in writing from Braidy Industries that sufficient financing has been secured to complete construction of the planned facility."
No deadline was set for when the documentation needs to be submitted to Kentucky Power. Bouchard said it wasn’t due until next year in his Facebook post.
On Monday, Braidy Chief Operating Officer Blaine Holt was part of a roundtable discussion at NASDAQ about hiring veterans. Much of Braidy’s leadership team has a military background.
The Daily Independent in Ashland contributed information to this report.