The U.S. Bankruptcy Court has approved the sale of Blackhawk Automotive Plastics Inc. to Flex-N-Gate Corp.
The deal, authorized by Judge Kay Woods on March 5, is set to close March 14 for Blackhawk's factory in Salem, Ohio - but will result in the closing of a second plant in Mason, Ohio.
Flex-N-Gate paid $16.5 million for Blackhawk, which filed for Chapter 11 protection in U.S. Bankruptcy Court in Youngstown on Oct. 22. Flex-N-Gate was the only bidder for Blackhawk, which generated 2007 sales of about $170 million.
Three other bidders had shown interest, but the parties could not resolve terms, and they did not make a bid. One of them, Magna International Inc., attended the March 5 hearing in Youngstown.
Money from the sale will go to pay secured debt held by a group of banks led by LaSalle Business Credit LLC. Blackhawk owes the banks about $33 million.
Before the court hearing, Flex-N-Gate, of Urbana, Ill., had lowered its proposed price to exclude the Mason plant and buy only Blackhawk's headquarters factory in Salem. Blackhawk notified the state of Ohio that the Mason plant, with its 700 jobs, could close after the sale.
Blackhawk employs some 800 people in Salem, where it does automotive injection molding and assembly of parts such as louvered air vents, in-mold appliques and instrument panels.
Flex-N-Gate will consolidate Mason into Salem. The Mason factory will remain open during the transition, said Cliff Croley, Blackhawk's chief executive officer.
Croley said officials had hoped Blackhawk would fetch a higher price, but he is glad the company is making a fast exit from bankruptcy in five months.
``We're not elated, but we're glad to get a transition done. We're preserving about 800-plus jobs in Salem, Ohio,'' Croley said.
Croley said that the sale to Flex-N-Gate does not include about $16 million in accounts receivable, which Blackhawk will use to pay creditors.