Saved by the Bell?

Ohio plant bought by neighboring company; questions still loom 

A long-standing manufacturing operation in eastern Ohio may have been saved by a neighboring business—but only time will tell.

Quaker Mfg. (Salem, OH) is a metal stamping and fabricating plant that has served several automotive, recreational vehicle and outdoor power equipment markets for over 50 years. Quaker, home to 115 workers, seemed on the verge of shutdown as recently as early June.

Located at 400 W. Railroad Street in nearby Columbiana, meanwhile, Compco Industries manufactures tank heads, operates metal stamping presses and HD plasma cutting equipment, and also has a full machine shop. The company appears to have bailed out its neighbor—or at least salvaged its operations for the time being—by forming a new entity called Compco Quaker Manufacturing last week, WKBN First News reported Wednesday.

While local news outlets have already jumped to bill this as ‘jobs saved’ (see the video below) the company’s future remains precarious. The complication here is Quaker’s ongoing legal issues. The joint company was formed just before Quaker’s lender, First National Bank of Pennsylvania, filed a breach of contract lawsuit saying the company failed to make payments on $4.8 million in debt.

The ensuing hearing resulted in Quaker being placed under receivership by a federal judge, meaning it could potentially still be shut down at any time. The order cited financial instabilities as a threat to effective operations and management in designating the receivership, which went into effect Wednesday.

Compass Advisory Partners LLC, a Pittsburgh-based management consulting firm, was named the receiver on behalf of First National Bank of Pennsylvania. According to the order, the receiver is to manage, protect, preserve, operate and, if necessary, liquidate the business to protect the bank’s investment.

The receiver also has the authority to pay salaries and wages of all managers and employees of the company. In a nutshell, Quaker’s fate is in Compass Advisory’s hands now, until further notice.

Neither Quaker nor Compco has made an official announcement about the possible sale or the impact on any layoffs in relation to this week’s developments, WKBN reported. On June 9, in a letter to employees, Quaker said it could permanently shut the plant down later this month, idling all employees if it couldn’t reach an agreement with its bank, while also investigating alternatives for the plant.

Advertisements

No comments yet... Be the first to leave a reply!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: