AmeriChip International Inc. (ACHI)
This is a printer friendly page!
International is ready to bring their technology to the marketplace that could lower cost
and health risks for industrial metal machining companies
In 1987 Mr. Walther purchased the National Abrasive Systems Company (NASCO), which has been in the distribution of abrasive products fro the National Grinding Wheel Company in New York State since 1924. By the time he purchased Abrasive Supply West Inc. in 1989, he had increased sales and profitability of NASCO to the extent that we was able to [purchase Ruff Abrasive in 1998 putting all plants under the NASCO brand in a 22,000 sq. ft. facility. Mr. Walther is also a certified abrasive engineer as conferred by the Abrasive Engineering Society and in 1992 he was elected President of the South East Michigan chapter, the youngest President in its 30 year history.
In 2001, Mr. Walther purchased the Canadian Grinding
Wheel Company and the Wright Abrasive Company in Hamilton, Ontario, Canada. With the
consolidation of the two plants, Cangrind became the largest grinding wheel manufactured
in Canada. Also in 2001, Marc became a partner in AmeriChip, Inc. and as Chief Operating
Officer, will be responsible for the management of the company as well as directing and
coordinating the Companys sales and marketing programs.
CEOCFOinterviews: Mr. Walther, what attracted you to AmeriChip?
Mr. Walther: The biggest thing that attracted me to AmeriChip was its revolutionary ability to decrease costs. With looking at everything that is going on in the United States and the jobs lost to China and Mexico; this is truly a way to bring jobs back to America. It doesnt matter if you are in China, Mexico or wherever, you are not going to be the low cost producer of machine parts.
CEOCFOinterviews: What is your process?
Mr. Walther: The
process that we have allows you to apply our process and it is patented. When you are
producing axle shafts, our process will allow you to produce three to one. One of the
other things that we offer our machine parts manufacturer customers is cost savings,
because we can take existing equipment and we dont have to change anything, but
allow it to run faster and we eliminate coolant costs, which is 17% of your machining
cost. The other savings would be that if you are using fancy tooling to affect shift
control and to run your parts, we just use basic tooling. For an example, we had a company
that we just completed testing and we are getting for production, and we went in and they
were producing this job that they had original offered across to a customer that was
basically four people, three shifts a day and seven days a week. We came in there with our
process because we still werent making any money at that point they were able to
produce the same amount of parts with two people, two shifts a day, five days a week and
that is without implementing any of the other things. We give you a platform to start
building many other things.
CEOCFOinterviews: Will you give us a background on the development of the company?
Mr. Walther: The
development of the company was done by Ed Rutkowski, and I have to give him credit because
everybody told him it couldnt be done; the big companies wanted him to shelve his
idea and they knew how profitable and how much savings or market share they would lose. He
developed the process with a company called Fraunhofer, which is a think-tank that only
accepts so many patents worldwide and they accepted his. They helped to move it forward to
Ford Motor Company, and Ford put their top engineer in research and development, they call
it advanced technologies, they studied it and to this date, they will fund the process in
testing at any one of their plants. What we plan to do at that point instead of going out
there because that is where I got involved when Fraunhofer signed off, and I reformed the
corporation and we put the patent in the corporation. I decided that we were a company
with no orders at that point, and how were we going to move forward. We had some base
loans and we had to come up with the other half of it. Venture capital is just another
word for we are going to charge you more and give you less, so we looked at the takeover
of a public company called Southborrough Ventures, Inc. and we changed its name to
CEOCFOinterviews: What is the companys financial condition?
Mr. Walther: To this point we have no revenue except for this order that we have coming from processed parts. We want to show the public that we can implement a process and create revenue, and that is what we have done with this order. In the mean time, we are looking at acquisitions. What has been complex is that the company we are trying to purchase is in chapter 11; it is making money and it is a healthy company. It is about getting a package that we can live with and I think we are almost in completion of that.
CEOCFOinterviews: If Ford knows you can do this shouldnt they be jumping at this opportunity?
Mr. Walther: They are! But the problem is that when you start implementing your process at Ford, they have little caveats like if they decide they dont like the job we are doing for any reason, they can take the process that they just approved and take it somewhere else; and we dont want to sublease it to anybody. Then we would start losing control. There are mechanical patents and there are process patents; mechanical patents when you invent something such as a cup, and a process patent is if you add a handle to the cup. Our patent is on the theory or idea of holding water, thus if you are using laser to affect chip control, then you are violating our patent. With Ford, we really didnt want to go any further with that; we wanted to do the implementation by having our own tier-one company. If you are not smart with your patents of not letting too much of the technology out into the world, you could have somebody doing it in China and not know about it and you cant sue somebody until you find them, so we are very careful. We dont let everybody see our process, but when we choose to let someone, they have to sign a non-disclosure.
CEOCFOinterviews: Lets say you have the acquisitions done and you have the company that is ready to make the part, is price alone going to get you into the door to sell them?
Mr. Walther: Absolutely! You are looking at automotive companies that are happy to get 3%; they are tripping over themselves to get 3%. Upper management and automotive has a directive that goes downward only; you will Mr. Engineer, get 14% savings to your department or we will find someone else and they are doing it. Now, we come in and all the conventional testing for cutting tools has been done and it has been exhausted over the years. To get even a 1% savings is phenomenal. Here we walk in, and we are talking about a process that gets you 85% savings, 50% savings, 25% savings; multiple savings in different areas. The automotive has to open up to that.
CEOCFOinterviews: What are the challenges you face getting this accomplished?
Mr. Walther: It is very simple, the only obstacle we have is financing. Working capital is everything; we could make this company rocket off like a bazooka because these people are looking for these kinds of things. If I do it without the proper working capital, then I have to tell the stockholders and the management team because it will kill the company. I have to get a working capital package that I can understand how fast I can move and then implement the plan. The plan is there and it is the working capital that gives us the timeline, so I have been working very hard on ensuring that and I feel I am getting very close.
CEOCFOinterviews: The concept makes sense!
Mr. Walther: Most companies dont have a solid idea, but this is a solid idea. With working capital being the thing every company has to watch, I can control the growth and it isnt going to be a problem getting orders if I can control the growth based on working capital and capacities that the companies we buy have.
CEOCFOinterviews: Once it starts, it will be like dominoes!
Mr. Walther: Exactly! And the key is the working capital and that is why I feel I am almost there.
CEOCFOinterviews: You talked about keeping jobs in America. If you are going to need fewer workers and the work it is going to be done so much faster, how does that save jobs in America?
Mr. Walther: The only options that a lot of the large companies have now, being that labor is their biggest cost, the steel and machine is going to be the same price, you are looking at labor and the overhead of the buildings, and lets say that the overhead of the buildings is going to be the same even though we know they are not, that big wad of cash out there is yea, human beings. It is going to happen; those companies are going to move, and I cant stop that process but I can introduce the AmeriChip process, which is going to stop the bleeding of American jobs out of the country. All of the jobs we have lost, we can recoup because we are a low-cost producer and all the jobs that might have been going out, which I think every automotive production job that is out there right now has a possibility of leaving this country purely on the fact of labor costs, and we can help slow that down. As energy becomes more costly, these companies are going to at not shipping to China because they cost so much to come back. They can make it cheaper than China by using our process. If you throw in the energy factor and we cant help but save jobs for America.
CEOCFOinterviews: In addition to having such a good basic product, the climate is right as well is that correct?
Mr. Walther: Yes it is, it has never been so right!
CEOCFOinterviews: Is there anything else that investors should know about AmeriChip, and is there anything they might not realize when they look at the surface of the company?
Mr. Walther: The biggest thing to look at is this is a simple process that doesnt require a lot of capital to implement. The thing that should jump out at you is the size and potential of our market and how we can affect it. Looking at that and looking at being a low-cost producer, should be exciting for people looking at the company. The biggest thing that should jump out at people is the financial package. Our business plan is sound; our idea is more than sound. It is just a matter of putting gas in the tank and once we do, this company will grow at a rapid rate.
CEOCFOinterviews: Are there forces to try to stop you?
Mr. Walther: Yes, we havent encountered any forces that would stop us except that since 9/11 the financial market has gotten very tight and the LTV mode to asset ratio has changed. Before if you were a new company and you would be doing 75%, for every dollar you would have to come up with 175% asset to that dollar. It has gotten even tighter than that, sometimes even 3/1 asset to value. That has probably been the only obstacle that we have encountered and we are actually hurdling that well. But there is no alternative to a merchant. All of the ship breaker inserts that could have been created geometrically have been created. They are coming up with this and that and trying to do it but the end result is the tools wear and the chip breaking doesnt last long or never starts. You still have to run it at lower speeds to compensate for the heat. We have no competition. Our biggest obstacle is the financial package to help us perform it.
CEOCFOinterviews: In closing, what would you like readers to remember about AmeriChip?
Mr. Walther: Again, we are in the acquisition mode. I want to thank the stockholders for being patient with us; this has been a long hard road but I cant begin to tell you how hard the board has worked to move this forward. We believe strongly in what we are doing and we have funded this company to this point. I think you are going to see great results.
To view Releases highlight & left click on the company name!
TOOL AND ABRASIVES
ceocfointerviews.com does not purchase or
recommendation on stocks based on the interviews published.