While its parent company battles a court order to stop making some of its most lucrative products, toy rotomolder Little Tikes Co. has ended speculation about plans to leave its sprawling complex in Hudson, Ohio.
During a Dec. 4 interview at Little Tikes headquarters, Tom Richmond, executive vice president at MGA Entertainment Inc. and general manager of Little Tikes Worldwide, said plans to sell the 122-acre, seven-building campus and lease back portions for Little Tikes operations have been all but shelved, due to the lagging U.S. real estate market.
The company is seeking a tenant for up to 1 million square feet of unused space, Richmond said. ``We own it, so there's no pressure on us to do something, but it would be nice to have someone in there, even if it's just to help us pay the power bills,'' he said.
Moving operations from Hudson to Mexico, for example also are not in the offing, he said.
The 50-year-old arrived at Little Tikes in October, part of a 30-year career in the plastics industry that included stints with Silgan Holdings Inc. of Stamford, Conn.; Los Angeles-based RXI Plastics Inc.; Berry Plastics Corp. of Evansville, Ind.; and Greenwich, Conn.-based American Can Co.
Richmond's arrival at Little Tikes followed a period of uncertainty about its finances and that of its parent company.
Van Nuys, Calif.-based MGA is embroiled in a lawsuit with Mattel Inc. of El Segundo, Calif., over MGA's popular Bratz dolls, which in recent years have outsold Mattel's Barbie line. On Dec. 2. U.S. District Judge Stephen Larson issued an injunction that will take effect in February barring MGA from making Bratz products.
Larson's ruling followed a three-month trial that ended in August with a verdict in favor of Mattel. The jury in the trial found that Bratz dolls were designed by a former Mattel employee who secretly shared the concept with MGA. Mattel claims the jury awarded it $100 million; MGA says the number is closer to $20 million.
MGA Chief Executive Officer Isaac Larian issued a statement Dec. 3 promising to appeal. ``We will seek to stay enforcement of this order until our appeal is resolved so we can maintain the over 1,500 people that MGA employs and continue to give our consumers a product they desire,'' he said.
Executives at three suppliers to Little Tikes, who spoke to Plastics News on the condition that they not be identified, said during the summer the company stopped paying its bills for a few weeks, after Wachovia Bank froze MGA's accounts because of uncertainty over the outcome of the trial. The sources said Larian was able to secure private financing in late August, and Little Tikes began making payments again.
``There's no public debt. Wachovia is out of the picture and we're self-financed,'' Richmond said in a Dec. 5 telephone call.
If Mattel has Barbie, Little Tikes has its own icon: the Cozy Coupe ride-in children's car that turns 30 next year.
In January, a new version of the coupe will hit stores with a pair of eyes above the grille, which has been transformed into a smile. The new car is 5 percent narrower than its predecessor and has a handle molded into the roof to help parents or older siblings push it along. Instead of an open floor in front of the seat, the new coupe has a removable floorboard that will help keep smaller kids securely inside.