ContinentalAFA Dispensing Co., a manufacturer of trigger sprayers and lotion pumps, reportedly is going out of business, leaving more than 550 unemployed.
According to reports in local media, the company's plants in Bridgeport, Conn., and Cartago, Costa Rica, suddenly shut down July 24 and 25. When contacted by telephone July 28, officials at the company's headquarters and plant in St. Peters, Mo., and its plant in Forest City, N.C., referred comment to Bill Driggers, president and chief executive officer. He did not return calls.
Raleigh, N.C.-based The News & Observer later reported on July 31 that the Forrest City location would close by mid-August, laying off 219.
ContinentalAFA is the subject of a lawsuit filed July 15 in U.S. District Court in El Paso, Texas, by Intermex Manufactura SA de CV of Juarez, Mexico. The suit alleges ContinentalAFA reneged July 8 on a five-year shelter manufacturing agreement for injection molding that the two firms signed in 2005. The lawsuit seeks about $672,000 in damages, including severance payments to 51 Intermex employees, unpaid invoices and factory lease payments Intermex must pay though 2010.
``[ContinentalAFA] informed Intermex on July 8 they were terminating the contract and terminating all production,'' said Intermex lawyer Michael McLean of El Paso in a July 28 telephone call. ``We've heard rumors that [ContinentalAFA] may have been bought, but they're just rumors at this point.'' ContinentalAFA has until Aug. 12 to answer the lawsuit, he said.
Privately held ContinentalAFA was formed in 2002 as part of the 14-month Chapter 11 bankruptcy reorganization of Indesco International Inc. At the time it was formed, ContinentalAFA's yearly sales were about $100 million. The reorganization eliminated more than $153 million in debt, with former bondholders taking an equity position with the company.
Chilmark Partners Inc. of Chicago was one of the 2002 equity owners of ContinentalAFA. The investment firm sold its share about two years ago, partner John Haeckel said in a telephone interview. ``It was time for us to sell,'' he said, but he did not elaborate. Haeckel said a private investor bought ContinentalAFA, but he would not name the buyer.
ContinentalAFA in 2003 bought some of the injection molding assets of Owens-Illinois Inc. The assets included plants in Bridgeport and El Paso. ContinentalAFA's forerunner Indesco had grown through acquisition as well: In 1998, the company purchased the St. Peters-based Continental Sprayers division of Contico International.
The Connecticut Post of Bridgeport reported July 25 that city officials were frustrated ContinentalAFA didn't seek city help to save 55 jobs there. ``They appear to be one of those companies that came quietly into the world and decided to quietly leave,'' Edward Lavernoich, the city's deputy planning director, told the paper.
About 230 ContinentalAFA employees in Costa Rica may file suit to gain unemployment benefits, La Prensa Libre of Cartago reported July 25.
ContinentalAFA in 2007 announced $4.3 million in upgrades at the Forest City facility, to retain 163 jobs and create 40 new positions. Forest City was the former home of AFA Products Inc., which claimed to have invented the polypropylene trigger sprayer.