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TieTek supplier obtains financing to add two production lines

North American Technologies Group Inc. (NATK) recently reached a $14 million financing agreement with Sponsor Investments L.L.C., which will help the supplier accelerate the construction and start-up of two additional TieTek™ composite-tie manufacturing lines by mid-2004.

On Aug. 14, the supplier expects to obtain $2.1 million from Sponsor Investments, which includes Beta Capital Group L.L.C. and Sammons Enterprises Inc., with the balance pending in fall.

The 10-year deal includes variable interest rates and pledged security interest in plant, equipment and intellectual property. A newly formed, wholly owned NATK subsidiary will manage TieTek manufacturing. Sponsor Investments retains an option to acquire 49.9 percent of the new subsidiary for $5 million during contract years three through seven.

"We estimate that this production, added to the output of our existing Houston plant, will total 350,000 ties per year," said NATK President and Chief Executive Officer Dr. Henry W. Sullivan in a prepared statement. "We intend to further expand manufacturing capacity aggressively with the financial support of our new sponsor, [and] extend TieTek technology by a combination of research and development, a patent program and by strategic acquisitions."

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More News from 8/11/2003