CoTec Investment MagIron Acquires Reynolds Pellet Plant and Launches United States Based DR Grade Pellet and Merchant Pig Iron Strategy

Executive Summary

• MagIron LLC entered a binding Asset Purchase Agreement to acquire the Reynolds Pellet Plant in Indiana from Altos Hornos De Mexico, S.A.B. de C.V., with closing expected before 31 Dec 2025.
• The plant, previously operating at ~2.2 mtpa (expandable to 3.0 mtpa), will give MagIron 100% ownership of a vertically integrated iron‑ore concentration, rail load‑out and pelletizing complex originally built for ≈ $660 million.
• The acquisition is a strategic step toward establishing the U.S.’s first fully integrated merchant pig‑iron operation, supporting domestic steelmaking and reducing reliance on foreign imports.

Key Details

• Acquisition Target: Reynolds Pellet Plant (iron ore pelletizing facility) near Reynolds, Indiana.
• Seller: Altos Hornos De Mexico, S.A.B. de C.V. (“ASHMSA”).
• Purchase Structure: Binding Asset Purchase Agreement; transaction amount not disclosed.
• Closing Timeline: Expected to close on or before 31 December 2025, subject to customary conditions precedent.
• Facility Specs:
• Modern straight‑grate pelletizer, previously placed in care & maintenance (2016).
• Historical annualized run‑rate ≈ 2.2 million tonnes per annum (mtpa) of pellets; design capacity up to 3.0 mtpa with limited additional capital.
• Prior investment in the plant ≈ $440 million.
• Integrated Asset Portfolio Post‑Acquisition:
• 100% ownership of iron ore concentrator, rail load‑out facility, and pelletizer (total historic build cost ≈ $660 million).
• Strategic Rationale:
• Enables rapid restart of DR‑grade pellet production.
• Positions MagIron to develop downstream pig‑iron facilities with Primetals Technologies, aiming for the first U.S. merchant pig‑iron producer.
• Supports domestic steel supply chain (automotive, aerospace, defense) and reduces carbon footprint by lowering reliance on imported high‑impurity pig iron.
• Due Diligence: Completed technical, commercial, legal, and environmental reviews; historical production and cost data validated capex, operating costs, volumes, and restart schedule assumptions.
• Funding: Acquisition and restart to be funded at the MagIron level; no additional capital required from CoTec Holdings.

Notable Quotes

“Acquiring the Reynolds Pellet Plant is a transformative step for MagIron… we are well advanced in establishing an entirely domestic supply chain of high‑quality, low‑carbon ore based metallics for American steel production.” – Larry Lehtinen, CEO, MagIron

“This is a significant step forward for MagIron. Once the Acquisition is completed, all the necessary building blocks will be in place… we are also encouraged by MagIron’s strategy of pursuing merchant pig iron facilities due to higher market prices.” – Julian Treger, CEO, CoTec Holdings Corp.