Plastic lumber maven Floyd V. Hammer is back in the saddle. Hammer, who at one time was nationally known as an advocate of recycled-plastic lumber, has retaken control of the company he founded in the 1980s in Iowa Falls, Iowa, according to a news release the firm issued Nov. 25.
Plastic Recycling Inc. has been renamed Hammer's Plastic Recycling Inc. — the original name Hammer gave the firm.
Hammer left the company in 1995, amid legal disputes with management. He now serves as chairman of the board. Leading the reorganization is John Rietz, an investment banker and turnaround specialist who has been named Hammer's executive assistant.
At one time, Hammer's Plastic Recycling had factories in Iowa Falls, Chicago, Los Angeles, Mulberry, Fla., and Denton, Md. The company went public in 1993 — and public documents revealed the company steadily lost money, on annual sales of about $2.5 million each year. All the plants, except for the Iowa Falls headquarters, have closed.
Things got ugly in 1994 and 1995. Hammer said that management of the company sharply reduced his role. He left in mid-1994. The firm sued Hammer. He sued back. In February 1995, the two sides signed an agreement ending all legal disputes and calling for Hammer, as the largest single shareholder, to sell a set number of shares each month until his involvement with the company was ended.
Then on May 24, 1996, Nasdaq dropped the company from its small cap issues for having ``insufficient capital.'' The company's board took ``Hammer'' out of the name and began calling the company Plastic Recycling Inc.
Then in October, the company announced the resignation of Bill Kunz as president and chief executive officer. Several other board members also resigned.
Last week, Hammer was traveling and could not be reached for comment. But Rietz said Hammer was able to regain control of the company because he, along with a bank and the U.S. Small Business Administration, were the secured creditors, and the company had gone into default.
Kunz, reached at his home in Brant Beach, N.J., said the company defaulted when financing fell through that would have paid Hammer for his shares.
Rietz said the company has monthly sales of $150,000-$200,000. The company continues to lose money. Shares are being traded on the Nasdaq over-the-counter bulletin board.
Hammer's Plastic Recycling has hired Tom Imperato as director of sales. Rietz said management is taking steps to turn around the plastic lumber firm.
``We've really cut the bleeding substantially,'' he said. The company could become profitable in February, he said.
Meanwhile, work is almost done to create the first ASTM standards for plastic lumber. Kunz said the standards are needed to help the plastic lumber industry.