Heavy Metal

Finding an opportunity and building a business in Youngstown, Ohio, during the 1970s and 1980s was not the easiest path to take.

But the Ramun family laid a foundation during those two decades upon which they have continued to build as they formed a successful group of inter-related companies under the Allied banner.

Allied began in 1971 by John Ramun and his father Michael. The company started out offering rigging services for operating plants as well as the demolishing or dismantling of industrial buildings. From the start, the company focused on the value of recoverable metals as a key part of its demolition (company officers prefer the word dismantling) business.

From the 1890s through the late 1970s, Youngstown was a city that made steel, with several mills found along the shores of the Mahoning River. But when the recession of the late 1970s and early 1980s took its toll on large, integrated steel mills, the city in the northeastern corner of Ohio was hit hard, as mills scaled back or shut down and furnaces that had been melting steel for decades flickered out permanently.

Just a few years before that recession occurred, Michael Ramun and his son John purchased six acres of property in southern Youngstown—near several of the steel complexes—with the intention of starting a scrap yard. In the course of preparing the site as a place to do business, the Ramuns learned a great deal about taking down buildings and recovering the resources and assets of buildings.

Allied Erecting & Dismantling (AED) was started in 1973. "We did some rigging work when we started in business," recalls John. "We started in this town as a local company, and that’s how most family businesses do start," he adds.

Demolition opportunities in eastern Ohio and western Pennsylvania presented AED with a number of high-volume and high-profile projects that built Allied into a regional and then national company. In particular, Allied has specialized in the dismantling of steel mills and other industrial facilities.

From the beginning, the company found the niche that helped steer it toward a profitable business segment that, in turn, led to several other opportunities. The projects the company bids on and undertakes have been almost exclusively industrial facilities with a high concentration of metallic buildings, machinery and equipment.

On any given project, Allied estimates the recoverable metal tonnage that is on site, making that a key factor in any bid amount. Typically, on any given Allied dismantling assignment, a home is found for ferrous scrap at a nearby consuming mill. Nonferrous scrap is usually shipped back to the company’s property in Youngstown, where it is processed and sold.

"We have good relationships with many consuming mills," notes John regarding the market for its ferrous scrap. Nonferrous scrap is sorted and processed by Allied at its Youngstown facility. Among the nonferrous tonnage at its Youngstown site is a significant amount of copper-bearing wire. The wire is burned in an EPA-approved furnace, with the bare burnt copper then being baled for shipment.

Allied developed its own baler for light gauge steel and nonferrous metals that at times is taken to job sites and also processes material in Youngstown.

In all cases, estimating the amount of metal that is present on a site becomes crucial in submitting a bid that leaves room for a workable profit margin. "We do pretty good; we’re pretty accurate in our calculations," says Michael Ramun, John’s brother, who heads up the bidding and scheduling side of Allied’s dismantling operations.

Among some of the high-profile demolition and dismantling jobs Allied has tackled are the U.S. Steel Ohio Works steel mill in Youngstown, a group of LTV steelmaking facilities across Ohio and Pennsyvlania, the U.S. Steel Fairless Hills complex in Pennsylvania, and the General Motors Tarrytown assembly plant in New York.

The specialized demolition and dismantling work the company has done, as well as offering turn-key environmental services, has made it a preferred contractor with several major companies in the steel and automotive industries.

John Ramun says he prefers the word dismantling to demolition to describe the work they do. "I look at our industrial plant work as dismantling, because there are so many factors relating to how machinery and materials are extracted and recovered," he remarks.

One recent example would be the techniques used at the General Motors Tarrytown site, located along the shores of the Hudson River about 20 miles upriver from New York City. There, the company had to take down a 3.8 million square foot automobile assembly complex that most recently had produced Chevrolet Lumina minivans. The owners of the land, however, stipulated that the structural concrete slab and pilings on which the main assembly plant was built had to remain intact and unbroken to serve as the foundation for a real estate development that will rise to take the assembly plant’s place.

Allied designed a plan of removal, floor by floor, utilizing appropriately sized shear equipped machines starting on the upper floors of the assembly complex to minimize the amount of load that would impact the structural concrete slabs from higher points of the buildings. This method left the designated foundations as specificed by the customer.

Though it has grown significantly, the small company that started out with a father and his son remains a family business.

John’s father Michael passed away in November of 1986 after helping put AED on its successful course. Now, other Ramun family members are making sure that Allied retains its family atmosphere.

• John continues to provide the vision and leadership for the Allied companies, which collectively are known as Allied Consolidated Industries Inc. John is at the helm in developing the 240+ acres of land Allied has assembled in Youngstown between a CSX rail line and a bluff overlooking the company’s acreage.

• John’s brother Michael is largely responsible for the oversight of the demolition and dismantling operations. He is primarily involved with estimating and overall supervision of dismantling logistics and operations.

• John’s oldest son John Patrick (J.P.) is a project superintendent for Allied Erecting & Dismantling. As a superintendent for Allied, J.P. is responsible for all aspects of a particular project, from dismantling to environmental remediation. J.P. is presently running a project in Kokomo, Ind., at a plant owned by Delphi.

• John’s son Mark is a marketing manager for the Allied group of companies and manager – projects and administration for AED. He is responsible for the information systems at Allied, scheduling, and a variety of sales and marketing functions.

• Mark’s younger brother Matt is a college student who works part-time at the office in Youngstown. Another brother, Matthew, as well as cousins Michael and Daniel, though still in their teens, have begun putting in hours with the company.

• John’s mother Louise, 75 years old, spends her time at the office coordinating various office management tasks. (The truth is, the Ramuns say, she just likes keeping busy.)

Allied Erecting & Dismantling has done much more than merely survive into its third generation of Ramun family members. The company has not only thrived within its original market segment of demolition contracting but has also successfully entered several other business arenas.

Allied Consolidated Industries Inc. now consists of six companies that—though they often work together to provide full service to a customer—also function separately and have been configured to be their own profit centers. All six companies are headquartered in Allied’s new 24,000 square foot office building, which is situated near the center of the company’s 240-acre parcel of land.

-Allied Erecting and Dismantling Co. Inc. generates from $40 to $60 million annually as a dismantling contractor specializing in total or partial industrial facility decommissioning. In addition to focusing on scrap metal recovery, the company’s services include asbestos abatement, equipment relocation, and property transfer services.

-Allied Industrial Scrap Inc. buys, sells and processes ferrous and nonferrous scrap from many sources, though most prominently from its own dismantling operations.

-Allied Industrial Development Corp. renovates older industrial facilities, focusing on designing and planning services to upgrade an existing facility and prepare it for resale.

-Allied Industrial Contractors Inc. provides the construction managers and personnel to complete the renovation projects, including any environmental abatement tasks that need to be performed.

-Allied-Gator Inc. produces attachments for the demolition and scrap metal industries. The company’s line of heavy-duty mobile shears are configured for use with hydraulic material handlers, as are the company’s bucket attachments.

-Allied Industrial Equipment Inc. restores, upgrades and re-sells a wide range of industrial equipment. The company’s inventory may range from steel hot and cold strip mills, overhead cranes, and large motors to mobile material handling equipment. Allied Erecting & Dismantling is mindful of asset recovery opportunities in the course of its contracts, working with customers to provide the best market value for saleable equipment.

There may not be a more overused word in today’s business vernacular than "synergy," but in Allied’s case it is an appropriate word to describe the way the companies that have been created work together.

Each operating unit was the result of either customer requests or clearly recognizable opportunities extending from current operations.

The birth of Allied-Gator provides one example. "When we started developing the tools, we didn’t do it with the intention of selling them to the wider market," says Mark. Among the first attachments designed by John Ramun and his late father was a "can opener" type of device that was designed to tear away and dismantle large metal storage tanks.

After that initial success, they decided to design and build a shear that could take on the heavy-duty tasks often encountered by Allied personnel at steel mills, auto assembly plants and other large industrial facilities.

When Allied began designing and building its attachments, the primary consideration was usually durability and strength as opposed to keeping costs down. "Every one of our products could probably be said to be over-engineered," says Mark, "because we’re designing and building them to go to work for us and to last for 20 years."

According to Mark, the company uses proprietary hardened steel for its castings. The company’s shears contain three cast parts, and according to Mark, "in ten years of selling these shears, we’ve not heard from a customer of one cast part breaking or even cracking."

The Allied-Gator segment of the business has grown steadily, but Mark says the company has kept the speed of growth in check intentionally. "We felt that if we marketed too extensively, they might sell faster than we could make them," says Mark. "So we’ve held back on the marketing to a certain extent, instead selling them as we produce them."

That may change within the next year or two, however. Among the property development plans in place at Allied is the construction of a 180,000 square foot shop that will bring much of the equipment making operations under one roof and will greatly expand production capacity.

In addition to manufacturing new equipment, Allied has developed its own in-house expertise at restoring and upgrading machinery. Material handling equipment used at its dismantling work sites and its scrap yard are often used machines bought at auction and then restored at the company’s maintenance and repair facility.

Like its new and used equipment segments, the company’s asset recovery services were also a natural offshoot of existing Allied operations. While dismantling industrial machinery for scrap metal value is often the only option, there are many other occasions when markets can be found for large components, whole machines, and even entire mills. "We once sold an entire dismantled steel mill and shipped it to India," notes Mark.

More frequently, buyers can be found for certain pieces of equipment (or their pumps or motors) or for entire production lines. The company has become adept at finding buyers and recognizing what might have a resale value.

There are also many occasions when the company finds a home within the Allied organization for recovered assets. One such discovery is what Mark calls "the world’s largest coordinate measurement machine in the world," which was located at the GM Tarrytown facility. "We contacted the manufacturer in Germany and got a set of drawings of the crates the machine was shipped in originally, and then built a set of crates," says Mark. "We dismantled the machine and brought it back to Youngstown. We’ll install it in the new shop and measure each casting that comes in for quality."

In addition to the occasional piece of equipment, the company has also painstakingly procured materials from work sites in order to build much of its new office and plant space from recovered materials. Recovered items range from steel beams and sheet metal to overhead cranes that will service the new equipment manufacturing plant for Allied-Gator.

The company’s office building was framed primarily from materials recovered at the Fairless Hills steel complex and at a Youngstown dismantling site. Beams are currently being restored and warehoused that will be used to construct the 180,000 square foot manufacturing facility that will be built adjacent to the office.

In a span of less than three decades, Allied’s managers and employees can look back upon numerous accomplishments and significant growth. Allied Consolidated Industries Inc. now employs nearly 100 people at its Youngstown complex, and at any given time has an additional 50 to 100 people working at dismantling job sites.

"When we started in the early 1970s, we had no idea that we’d wind up doing what we’re doing now," says John. "I think by the late 1970s, we far surpassed what I thought we could be as a company."

Though the company’s progress has surpassed expectations, John and other company officers continue to foster visions of what the company can evolve into. "We will continue to become a diversified group of companies that will take strategic advantage of inter-firm alliances to offer services to our industrial customers," he states.

Plans on the drawing board for the next two years should keep Allied employees busy, as the company begins to develop the 240-acre parcel of land it has assembled. The new manufacturing space has to be constructed, and once it is that will allow Allied-Gator to more than double its production capacity. The company will move its scrap metal operations to newly-acquired land and upgrade processing capabilities, and may well begin accepting scrap from outside sources. At the same time, those responsible for the dismantling side of the operation see no reason to expect a decrease in business.

Thus far, the company has followed the vision of its leaders and been able to capitalize on opportunities. According to Mark, his father John "has a lot of vision for where we want to be for the future," putting the company on track for more of the same planning and execution in the years ahead.