Tool manufacturers Stanley and Black & Decker have agreed to a merger. The companies have been discussing such a move for decades, and recent economic trends made the deal a reality. Stanley, which manufactures hand tools and construction equipment, is buying Black & Decker, whose focus is on power tools; the merger was friendly and well thought out. Consumers will see little difference in products as the two companies' lines are not directly competitive.
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If only tenure existed for textile companies: After 120 years as a community staple in Pennsylvania's Columbia County, Bloomsburg Mills is closing its doors on May 31st, hurt by economic forces and imports. Bloomsburg Mills started as a silk weaver in 1889. It has been a high-quality manufacturer of fabrics used by a variety of industries now acquired elsewhere.
Door manufacturer Masonite announced a bankruptcy filing today. The company, which pioneered the use of special hardwood manufacturing techniques, has been in business since 1924. Masonite is widely used by construction and moving companies. Masonite Inc., which has been privately owned since 2005, reportedly has the financing in place for a successful restructuring.
Not economy-related, but certainly retail-affecting, the Peanut Corporation of America filed for bankruptcy protection on Saturday. The company is under extreme pressure following salmonella outbreaks traced to unclean conditions at more than one of its factories. Sales of peanut-based grocery products are down as much as 28% in the wake of the health scare.
Spectrum Brands, a consumer products manufacturer, filed for bankruptcy amid a heavy debt load earlier this week. Spectrum, which manufactures Rayovac batteries, Remington shavers and a variety of household and pet products, is working on efficiencies that will strengthen the company after its filing. Continuing operations are expected.
Legendary auto company Checker Motors, which once made cars like the Checker Cab, filed for bankruptcy protection due largely to declining sales at General Motors. Checker, which in recent decades has focused on stamped and welded car parts, is planning to reorganize and continue operating.
Merisant Worldwide filed for Chapter 11 bankruptcy today, shortly after its credit rating was downgraded to junk status. Merisant produces Equal, the blue-packeted artificial sweetener, and other products. The privately-held company has not disclosed whether the filing will affect manufacturing or distribution.
Limited connectivity, so one post:
Bloomberg report: holiday slump to force closings and bankruptcies; expect a lot of activity in February
Lincoln Logs, an upstate New York home manufacturer (not the toy), to be sold at auction following a failed reorganization
DHP Holdings, parent of Desa Heating, filed chapter 11, plans to wind down operations
It's a slow retail news week, so let's make note of the factory employees of Republic Windows and Doors, who spent the weekend and Monday in their factory after the company announced a rapid facility shutdown last week.
Republic, which has been in business since 1965, gave its employees three days' notice that their jobs would be eliminated. In response the staff, which in unionized, began an impromptu sit-in to protest the short notice. The company says it has no credit with which to make severance and vacation payouts; the employees refuse to leave without getting what they are owed. Negotiations were to resume last night.
The economic slowdown affects family-run, local businesses as much as it shakes publicly traded companies. A pair of long-time establishments announced closings this week:
- Modern Metal Products, an auto parts supplier dating to 1946, filed for Chapter 11 bankruptcy. The company expects to shut down; it found a willing buyer, but the buyer was able to arrange financing to complete a sale.
- John Wilson Sporting Goods, a Cedar Rapids-based retailer also in business since 1946, is closing its doors at the end of the year. Current economic conditions prohibit the owner from signing a new lease. Sadly, owner John Wilson is quoted as saying, "I can't see somebody wanting to start a locally-owned sporting goods store."
It's harder to quantify the retail impact of a company closing a factory, but a shuttered plant certainly affects product supply and consumer spending, so it's worth noting the numerous shutdowns announced this week:
- Shaw Industries is closing a fibers facility in South Carolina that makes products for rugs, carpeting, laminate and other uses.
- Aluminum recycler Aleris is shutting a factory in Indiana that has been idle since March.
- In North Carolina, Vaughan-Bassett is closing a plant used for furniture production, citing a dramatic decline in sales this fall.
- Super Steel in Schenectady, which made train components, is closing in early 2009.
These are all fairly small closings (the biggest will affect 400 people; the main auto workers' union has 139,000 members), but they point to cautious companies and lower consumer spending from the recession.
Eclipse Aviation, a pioneer in the ultra-light jet segment, filed for Chapter 11 protection today after failing to raise capital in the current economy. The company was using bridge loans and reduced output to preserve its business, and had not achieved profitability. It also had lawsuits pending from customers angry at Eclipse for raising the price of its jet prior to delivery.
Eclipse must be particularly disappointed with its timing, as the European Safety Agency approved the Eclipse 500 for sale in 37 European countries this past Friday. The company's CEO was hopeful that the certification would improve its ability to secure funding.