FRANKFORT, Ky. (WDRB) – Braidy Industries still needs to raise about $500 million from investors to start construction of its much-anticipated aluminum mill in northeast Kentucky, the company’s new CEO told lawmakers on Tuesday.
Tom Modrowski, who took the reins of the company last month after its board fired company founder Craig Bouchard, told the Senate budget committee that the 27-month construction project could start in the final three months of 2020.
"It is our expectation that this will happen by the end of the year," Modrowski told lawmakers. "... We are working diligently every day to make sure this thing happens."
That means the plant, once projected to open in 2020, won't come online until the end of 2022 or early 2023 at the earliest.
Recent turmoil at Braidy Industries – Bouchard disputes his firing and has said he can replace the board members who ousted him – has raised concerns about the status of the project and the $15 million in taxpayer money that Kentucky invested in Braidy Industries in 2017.
Big crowd gathering for @braidyinc CEO at A&R committee #kyga20 pic.twitter.com/AjjeAOhTrs
— Chris Otts (@christopherotts) February 11, 2020
In prepared remarks, Modrowksi told the committee that the board replaced Bouchard “because they want to see more progress, faster.
“The board is eager – like you – to get this project built,” he said.
Bouchard, for his part, has said on Facebook that the board disagreed with this approach to financing the mill through foreign investors. He has declined an interview since the ouster.
Modrowski declined to answer questions from Senate budget chairman Chris McDaniel, R-Taylor Mill, about what exactly led to Bouchard’s firing, the source of a personal loan to Bouchard that is described in Braidy Industries’ public disclosures and whether the state can recover its $15 million in Braidy Industries fails to build the mill.
“We try to stay away from the hypotheticals,” Modrowski said regarding a possible return of the state money. “We are focused -- laser focused -- everyday we wake up to make sure this thing gets built ... We don’t think about a Plan B.”
Modrowski said Braidy Industries has about $65 million on hand and needs another $500 million on top of $200 million in pledged commitments to the project.
In April 2018, the company announced a potential $200 million investment in the mill by an affiliate of Russian aluminum giant Rusal, which would be the primary supplier of raw aluminum to Braidy Industries.
Under Bouchard, the company said it needed to secure another $300 million in equity from investors – bringing the total to $500 million – so it could then borrow the rest of the $1.7 billion needed to build the mill.
But Modrowski did not dispute Senate Minority Floor Leader Morgan McGarvey’s statement that the company now needs $700 million in total investments to finance the construction of the mill.
