Blow molder Mac Plastics Inc. has emerged from Chapter 11 bankruptcy protection with a returning owner and new controversy.
During a court-mandated auction May 12, the Washington, Pa., firm's assets were sold for more than $2.5 million to a partnership group headed by Pennsylvania businessman Angelo Falconi, also of Washington. Falconi, who owns car dealerships in Pennsylvania and Las Vegas, plans to reopen the plant and change its name to Falcon Plastics Inc., according to company officials.
The group was the high bidder for Mac's 600,000-square-foot industrial blow molding plant, which was put on the block by U.S. Bankruptcy Court.
Other bidders were liquidators wanting to sell off pieces of the company, said Margaret Good, president of Pittsburgh-based Meridian Group. The group had been hired by local bank officials to help find a buyer for the company.
The plant, closed since Mac entered voluntary bankruptcy protection in February, could reopen by the end of May, said former majority owner and company president Rudy DiNardo. More than 100 of the plant's 375 employees who were working when it closed could return by then, he added.
The sale represents the second time around for Falconi, who owned a majority share in the company from its founding in 1958 until he sold his interest in 1985 to DiNardo. DiNardo said he was Mac's first employee and gradually bought a larger ownership share.
Dinardo's brothers James and Norman also owned a share of the company before the sale.
While happy that the plant will be revived, officials with the United Steelworkers of America union said the new owner might be going back on his word. United Steelworkers Local 9204, which represents the plant, was instrumental in helping Falconi arrange financing, said union representative Andy Bury.
Falconi has not committed to rehiring the plant's union employees and has asked workers to reapply for their jobs, Bury said. The union fears that Falconi will make the plant non-union, he said.
``The steelworkers' support was necessary to give the company a hand in auctioning off the plant to Falconi,'' Bury said. ``That support carried a provision that we be returned there. Now, Falconi is being evasive about his plans, and we're concerned.''
The union is considering taking legal action if the plant goes non-union, Bury said. He added that Falconi would need labor support to gain the funds to put the company back on its feet, he added.
Falconi and his lawyer Edward Morascyzk were unavailable for comment late last week.
Mac had filed for Chapter 7 protection on Feb. 6 owing about $6 million to Pittsburgh-based National City Bank and another $6 million to unsecured creditors. The bank had foreclosed on a $2.7 million mortgage for the plant. Mac also owed about $380,000 in property taxes.
``Rudy [DiNardo] knew this was a good business with a good customer base,'' Good said. ``He went to Angelo [Falconi] and asked him to reinvest in the company. That was a big plus to the community by putting people back to work.''
DiNardo, who declined to discuss the reasons for the bankruptcy filing, said sales were $35 million in 1997. The plant has about 30 single- and double-shuttle blow molding machines that make products for the furniture, toy, medical and commercial-products industries, DiNardo said.
One of the company's main customers is Rubbermaid Inc. and its Little Tikes toy division, DiNardo said. The plant is a major producer of children's furniture and lawn and garden equipment.
``One of our goals was to keep the plant open and get people back to work,'' DiNardo said.
DiNardo expects to stay with the company in some capacity.
Mac, which recorded $16 million in 1996 sales, ranked 16th on Plastics News' most recent list of North American blow molders.