Green Arc tire retreading venture delayed

ST. MARYS, Ontario (March 18, 2016) — The backers of Green Arc Tire Manufacturing Inc. in St. Marys are refinancing the nascent passenger tire retreader's equity as they seek to get the project back on track following delays the company's top executive blames on the permit approval process.

Green Arc Tire had targeted late 2015 to start production at a repurposed Dana Corp. truck chassis plant in St. Marys, but to date the project has yet to produce a tire and details as to the status of the plant's equipment are sketchy.

In open letter to St. Marys residents posted on the firm's website, Green Arc Tire CEO and COO Mike DiCenzo blames the delay on undisclosed “behind-the-scenes ‘politics'” that he claims forced Green Arc to scale back the size of the project and number of jobs to be created.

“This uncertain political environment has not instilled confidence in Green Arc's investors,” Mr. DiCenzo wrote in the letter, “one of whom owns the building that Green Arc is leasing.”

The company has a five-year lease at the building — a 400,000-sq.-ft. former Dana Corp. truck chassis plant that's been vacant for years — which Mr. DiCenzo said is now for sale.

Mr. DiCenzo singles out the mayor of St. Marys, Al Strathdee, and the region's local member of parliament, Randy Pettapiece, both of whom told the Kitchener, Ontario, CTV affiliate they are baffled by his comments, saying Mr. DiCenzo never approached them directly with his concerns.

Green Arc Tire was founded in late 2013 by Mr. DiCenzo, a Canadian with more than 30 years' experience in the used tire, casings and recycling industries, with financial backing from Phoenix Capital Partners, a Toronto venture capital firm, and Bancorp Financial Services Inc., a Vancouver mortgage fund management firm.

Mr. DiCenzo put the investment at that time to start Green Arc Tire at $37 million (Canadian), with annual production of 3 million bead-to-bead passenger, light truck and SUV retreads — predominantly winter specification — projected at the new plant, with as many as 340 jobs under consideration.

In his open letter, Mr. DiCenzo said Green Arc was founded in 2013 with “high hopes,” but that “much has changed since then, and I feel an obligation to residents of St. Marys and the region to explain what has happened.”

For any new business to succeed, he wrote, “it must have a willing host that shares and supports its aspirations to generate new jobs and economic benefits. Any objective observer would conclude that since both the municipal and provincial election, Green Arc has not had the support of the Mayor of St. Marys or the local MPP.”

Without disclosing specifics, Mr. DiCenzo alludes to a lack of support by Messrs. Strathdee and Pettapiece for “new companies in a region where manufacturing jobs continue to disappear….

“What has happened to Green Arc does not send a positive signal to any aspiring business.”

Prior to this most recent communique from Green Arc, the firm's last public announcement was in July 2015, when it disclosed it had been granted the necessary environmental permits to operate its retreading plant, clearing the way for the start-up to begin preparing its site.

At that time, Green Arc said the project had been in a holding pattern pending proper permitting by the Ontario Ministry of the Environment and Climate Change.

It should be noted that part of the delay was due to Mr. DiCenzo's clearing up a decade-old issue with Ministry of Environment over an outstanding $25,000 fine related to a previous business venture.

Kitchener, Ontario-based rubber compounding specialist AirBoss of America Corp., which signed a deal with Green Arc in 2014 for the supply of up to 24 million pounds of rubber annually, declined to comment on the venture's delayed opening.