The two-day auction at the aging, closed-down HPM plant started off with a bang, as Chinese machinery maker Guangdong Yizumi Precision Machinery Co. Ltd. bought HPM's intellectual property.
Yizumi plans to reintroduce a line of HPM injection molding and die-casting machines.
Auctioneer Ron Moore sold the intellectual property first, on March 29, at the beginning of the two-day auction at the hulking 400,000-square-foot factory in Mount Gilead. That included the right to use the HPM brand name, mechanical drawings, engineering designs and customer lists. There was a short bidding war between Yizumi CEO Richard Yan and Dana Hanson, president of sheet extrusion line maker Processing Technologies International LLC of Aurora, Ill.
Yan started the bidding at $50,000. Hanson countered several times with higher bids. Hanson's final bid was $300,000. Yan topped that and the auctioneer declared the intellectual property was sold to Yizumi for $325,000.
In an interview, Yan said the well-known HPM name will help Yizumi enter the market in North and South America.
This is a milestone for us, he said. In the past, our major market is China. We sell 85 percent of our machines in the China market, and only 15 percent for export.
Most of the exports go to Southeast Asia. But we don't have any machines in North America. And none for Europe. So now we are prepared to expand our sales network, he said.
The auction was also a milestone for the village of Mount Gilead, where HPM was founded in 1877 to make apple presses. The 300-plus first-day auction attendees filed past one of the apple presses in the lobby, then walked by a 1937 injection press with a plaque noting that Santay Corp. bought that first HPM molding machine in the Chicago area.
Another 140 people bid online.
The plant shut down in December 2009. HPM, which was owned by Chris Filos, owes money to several creditors, including Huntington National Bank for loans, Morrow County, Ohio, for unpaid taxes, and to several state government agencies.
Filos started a wind-turbine company called Polaris America LLC. Parts of an unfinished turbine remain in the plant.
Yan said Yizumi will produce die-casting machines first, then follow with HPM injection presses, at its plant in Foshan, China. He said Yizumi is China's second-largest maker of die-casting machines and about the sixth-largest injection press builder. The company also makes rubber injection machines.
Yizumi employs about 1,100 and generated $100 million in 2010 sales, Yan said.
Yizumi was founded in 2002, started by former officials of Hong Kong-based injection press maker Chen Hsong Holdings Ltd.
The Chinese company will export the machines to North American and South America. The firm will take the best features of the HPM machines and redesign the equipment to make more of a global product line.
At the very beginning, we will only make them in China. And if it proves successful, then we will make it in the United States, Yan said.
For Morrow County and Mount Gilead, the demise of HPM has been painful. HPM employed about 1,000 back in the 1960s. By 2000, it was down to about 500 workers, and the number dwindled down over the next decade. HPM made injection presses, sheet extrusion lines and die-casting machines. Eventually, HPM was the only U.S. company that made all three types of machines.
Local government officials hope to land future jobs making HPM-brand machinery, although that could be years down the road. Morrow County commissioner Olen Jackson said Yizumi officials came to Mount Gilead about a month ago to meet with government leaders and tour the factory.
We've got a simple goal and that's making this stuff in Morrow County, he said, gesturing to the massive machine tools sitting idle on the wooden floor of the factory.
Commissioner Tom Harden said the community needs jobs. We're willing to work with them any way we can to help them stay in Morrow County, he said.
Yan said the first job will be sorting through the intellectual property. In the near future, Yizumi engineers from China will meet with U.S. engineers who are knowledgeable about HPM equipment.
The company also is looking for a U.S. partner to handle spare parts and service of the thousands of existing HPM machines, plus handle sales of new HPM equipment, he said. Sources at the auction estimated there are 6,000-7,000 HPM injection molding machines still in operation.
Former HPM President William Flickinger said he is acting as an adviser to Yizumi. Flickinger runs Bivouac Engineering and Service Co., a company in Marion, Ohio, specializing in HPM injection presses.
At the auction, Flickinger introduced Yan and three other Yuzumi officials to HPM customers and former employees.
Flickinger said he was saddened by the demise of HPM, where he worked for more than three decades. But he supports the new Chinese owners.
My position is, I'm trying to do anything to help HPM customers and continue the HPM product line, he said.
Another noteworthy purchase on the auction's first day: Milacron LLC bought a Weingartner whirler, a high-speed machine for cutting screws, for $500,000. The whirler will join two other Weingartners at Milacron's machining plant in , Ohio, said plant manager Jim Kinzie.
It gives us the ability to expand our capacity and get faster throughput, he said.
So that piece of metal-cutting equipment will remain in Ohio making components for plastics machinery. Other things, such as castings and old inventory, likely will end up as scrap, said Dave Troutman, who used to run HPM's Remanufacturing Division. Based on discussions with scrap dealers at the auction, he estimates 2,000 tons of metal are headed for the scrap yard.
Troutman now owns ITL Machinery Services in Marion, which rebuilds die-casting machines.
I'm here looking for parts and equipment, to buy some of their old inventory. And it's a trip through nostalgia. I spent 25 years here, he said.
Although the day was sunny, there was an early-spring chill inside the plant. For people who used to toil there, the auction was a combination of a funeral and a reunion, as they ran into old co-workers and traded memories.
Charles Hammond, a machinist, worked at HPM from 1965-2001.
It was always a good place to work. It wasn't one of the top-paying places, but it was steady. It's sad to come in and see it the way it is, compared to how it was when things were really going, Hammond said.
Machinist Mike Williams said: 'It's sad it ended like this. It boils down to the economy and mismanagement at the end.
Ron Allbritton, a former extrusion project manager at HPM, was bitter about Filos, the final owner: He hurt a lot of people.
But for many, the auction was a time to look back to happier times. It brings back a lot of memories, Albritton said, This was a great company at one time, and a lot of people worked here. It was respectable.
Houston-based Plant & Machinery Inc. ran the auction.
Christopher Parker, the court-appointed receiver, said the total sales amount will be filed in Franklin County Common Pleas Court in Columbus, and will not be made public before then. Proceeds will go into a special account. The judge will allocate how the money will be paid out to creditors, he said.
Parker, a lawyer from Toledo, Ohio, got the court's OK to turn the power on for the auction. Some equipment had been damaged while the building sat vacant. It was being broken into and vandalized, he said.