LYNNFIELD, Mass. (Sept. 14, 2005) — As it promised earlier, tire recycler GreenMan Technologies Inc. is closing its LaVergne, Tenn.,tire processing plant and assigning its scrap tire collection business back to Tennessee Tire Recyclers Inc. (TTRI) the company that originally sold GreenMan that business in April 2001.
TTRI had the right of first offer in case GreenMan decided to divest its Tennessee tire collection contracts, according to GreenMan CFO Chuck Coppa. Before divestiture, GreenMan gathered about 3.5 million to 4.5 million tires annually in Tennessee, Mr. Coppa said.
The LaVergne plant, which is not part of the TTRI acquisition, is now operating with a skeleton crew of two or three employees and will close completely by Sept. 30, he said. GreenMan will incur a non-cash loss on the transaction of approximately $918,000, but also will improve its cash flow by more than $150,000 monthly, the company said in a press release.
GreenMan, which said it collects and processes more than 30 million scrap tires annually, has hemorrhaged money in the past few years despite steadily increasing sales; in its fiscal nine months ended June 30, the company lost $5.5 million on sales of $24.5 million.