PVC plumbing maker Genova Products Inc. has closed plants, laid off workers and terminated medical benefits over the last two months as the company faces a financial crunch and what officials termed a shortage of raw material.
The owners reportedly are looking to sell the company or find a cash infusion.
Genova officials did not return telephone calls to its headquarters in Davison, Mich., near Flint. But published reports in local newspapers and television coverage said the company has had major layoffs or shut down facilities in November, December and January in Paducah, Ky.; Fort Wayne and Rensselaer, Ind.; Faribault, Minn.; and Sparks, Nev.
Genova, which has not filed any layoff notices as of Jan. 30, has laid off several hundred employees. Workers told local news outlets that they had no advance warning.
The company issued a statement to employees on Dec. 30 that it was terminating medical benefits, effective Dec. 31.
A trade magazine, HBSDealer, reported Jan. 29 that the Fort Wayne plant factory had shut down, and employees were laid off. HBS Dealer published a termination notice from a Fort Wayne employee that said: "Over the past several months, Genova has faced various economic challenges. These challenges resulted in the issuance of a letter by Genova's secured lender advising Genova that it was in default of its loan covenants and confirming that no additional funding would be provided to Genova for its operations. Over the past several months, Genova has been working tirelessly to try to locate a strategic partner to either purchase Genova's assets and continue operations or infuse necessary capital into Genova's operations."
HBSDealer reported the letter said Genova expected the Fort Wayne closing to be permanent. The publication covers the hardware and building supply industry.
In a story published in early December, Joseph Pusateri, director of operations at the Paducah factory and a Genova veteran, told The Paducah Sun newspaper that operations were suspended there in late November because what he said was a shortage of raw materials. He said company officials were looking to resume operations as quickly as possible.
Pusateri could not be reached for comment for this story.
Genova played a key role in the history of plastic plumbing products. The company was founded in 1962 by Robert F. Williams, a master plumber. At first it was a small plumbing supply house. Williams came up with the idea of selling plastic pipe, initially to owners of cottages in northern Michigan, since the then-new plastic pipe was prohibited by building codes. The cottages were not covered by the codes. He bought the pipe from extruders, developed complete kits and sold them to cottage owners as do-it-yourself projects.
Genova began extruding its own pipe and injection molding fittings. Williams fought to change building codes to allow plastic pipe. His son, Robert M. Williams, is chairman and CEO.
According to Plastics News ranking data, Genova has estimated sales of $135 million. The company also makes PVC gutters and decking.