Yesterday, the company did just that by combining its ceramic materials with aluminum in an application that could have uses in nuclear waste containment or help the company crack the vehicle armor market. We don’t know if this is the new application that will sustain Ceradyne’s growth rate. But it is the type of new applications Ceradyne must explore if it expects to do so.
Ceradyne, Inc. and Alcan Inc. (NYSE:AL) announced today that they have signed a multi-year agreement to fabricate and distribute a nuclear shielding boron carbide/aluminum Metal Matrix Composite [MMC]. Alcan’s Dubuc Works and Ceradyne’s recently formed subsidiary, Ceradyne Canada, will cooperate to produce state-of-the-art nuclear shielding structures, which will be formed into nuclear waste containment vessels. The incorporation of Alcan’s aluminum metal with Ceradyne’s boron carbide [B4C] powder results in a structural element [MMC] that can be formed into a system that effectively absorbs radioactive neutrons. Ceradyne will be responsible for the ultimate fabrication and distribution of these nuclear waste components.
Ceradyne plans on establishing an 80,000 square-foot manufacturing facility in Saguenay, Quebec, Canada, in order to process and extrude aluminum/boron carbide components using a state-of-the-art 2,750-ton short stroke press.
This technology initially will be focused on the market for spent nuclear fuel rods generated by nuclear power plants. However, Ceradyne and Alcan also intend to develop other aluminum/ceramic Metal Matrix Composites for a wide range of new applications, including the Company’s military vehicle armor program.
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Full Disclosure: The author is short put options on Ceradyne, which will require him to purchase shares at $45 later this month should the share price remain below that level.