13.01.2005, 12:16
´
Vom Flugzeugcockpit zur Lokalzeitung von Opelika:
Quantegy hearing today
Tamiko Lowery
Staff Writer
Wednesday, January 12, 2005
Quantegy filed Chapter 11 bankruptcy Monday in the U.S. Bankruptcy Court for the Middle District of Alabama, just 11 days after shutting down operations and closing doors.
A Chapter 11 hearing is scheduled today with Judge Dwight H. Williams Jr. presiding and Cameron Anthony Metcalf of Espy, Metcalf and Poston, PC out of Dothan representing Quantegy, according to Quantegy's docket of events for the day. According to the docket, the telephone hearings are scheduled for 2 p.m. Other details of the hearings were unavailable Wednesday.
"There are two very important things needed in restructuring - time and money. When you run out of cash - you're gone," said Richard Lindenmuth, Quantegy's CEO. "We declared Chapter 11 on Monday, to think about how to restructure. We want employees to be taken care of first, always. In the event we come out of Chapter 11, we've hired Equity Partners, Inc. to find new investors. There have been eight groups to visit the factory already, and each one has expressed continued interest in purchasing the company or potential new investors in it. I wish I could tell you that would happen, but I can't. I'm an optimist but the realistic thing is - we're struggling."
Opelika Mayor Gary Fuller said bankruptcy is not good news for Opelika Light & Power - now out roughly $250,000, which was owed to the department for past electric bills.
"We are in the 'unsecured creditor' category, which means we are not in a good position. I'd be surprised to see a penny," Fuller said. "Back in March of 2003, Quantegy had problems with cashflow and had asked the City of Opelika to work out a payment plan with them which Mayor (Barbara) Patton agreed to do, paying the city past due balance of $20,000 per month."
Fuller said that didn't make a dent in the money owed the light and power department.
"As I explained to Richard (Lindenmuth) two weeks ago Tuesday, $250,000 is probably just a chunk of change to him, but to us it's a lot of money," Fuller said. "Light and power is owned by the city, and the city is owned by the citizens and that's who ends up paying."
Fuller said the city would have already pulled the plug on electricity at the plant had it not been for environmental concerns of chemicals and hazardous material being there. He says the city would like to have the money it is owed, but more than that it would like for Quantegy to be back in business - producing tape, consuming electricity and contributing to the city's tax base.
"It's sad when people who have devoted their entire life to a company and then have it close with virtually no notice - it hurts more than just not getting a paycheck. It's about loyalty," Fuller said.
Lindenmuth said he saw the writing on the wall five years ago saying Quantegy has gradually spiraled down in profits with roughly $6 million in sales last year compared to $40 million, five years ago. He said just the plant's electric bill is sky high.
Ken Mann, exclusive broker for Quantegy and partner at Equity Partners, Inc., said Quantegy's recent filing of Chapter 11 could be a positive step.
"Essentially, the filing means that the company will get some 'breathing room' from creditors to remain open and satisfy customer orders while we continue to talk to prospective investors and purchasers," Mann said. "Our intention is to get to a sale transaction very quickly, and hopefully one that keeps the business as an on-going concern. We've had some good meetings with prospects over the last two weeks, and we are cautiously optimistic."
Collier Swecker, a tax attorney and partner of Swecker and Sparks, LLC in Opelika, said the hardest decisions are the ones made from the top. Although Swecker is not involved in this case, he says "from a business standpoint, sometimes you've got to do it."
"Look at the airline industry, companies do bounce back after bankruptcy all the time," Swecker said. "It's an opportunity to catch your breath. When you're headed toward a storm, you've got to be able to correct the course. Business is about trying to make a profit - I wouldn't want to work for someone who did not want to be profitable."
On Wednesday, Lindenmuth was quick to point out that Quantegy is not the only sinking ship in the industry.
"This is not just happening here - it's happening all over. The last two years, we started as a board and team to re-focus and redirect," Lindenmuth said. "This did not happen overnight, as much as five years ago we knew the industry was changing and had to take action. Last year, a major competitor in Germany, 10 times the size of our company went Chapter 11 and just disappeared. We've been trying for a long time to restructure, but we've had struggles."
Lindenmuth said he had been hopeful of cashflow a few years ago when Imation gave Quantegy a manufacturing contract to cover its expenses for two years when a new product, Digital Beta Cam, had been launched by Quantegy. But it was not smooth sailing.
"Imation people decided to build a factory and take 100 percent of their business away from Quantegy. There was no continuation of contract. That was the first blow, as it were," Lindenmuth said. "Then Digital Beta Cam, which was manufactured here, had quality control problems. DBC products kept being returned for faulty function. This contributed to the cash crunch we've had. We've since fixed the DBC problems but manufacturing of Imation is not coming back."
Still, he says he hopes Quantegy will come back.
Lindenmuth, who has been living here in a hotel for four and a half years away from his wife and four kids in North Carolina, says he will remain here for the duration.
"It's taken a lot longer to fix problems than first anticipated, but our employees always had a 'can do attitude.' We're fighting to bring this company back up with new investors, and I sure as heck hope it happens," Lindenmuth said. "This has been difficult for everybody. There's no easy thing about it. The employees were correct and good - (Quantegy closing) was not targeted toward them. It's the industry. There have been challenges. This is a wonderful community. There are really good people here in Opelika and Auburn. I hope to fix things and make it a viable company again. I'm not the kind of person who gives up."
Vom Flugzeugcockpit zur Lokalzeitung von Opelika:
Quantegy hearing today
Tamiko Lowery
Staff Writer
Wednesday, January 12, 2005
Quantegy filed Chapter 11 bankruptcy Monday in the U.S. Bankruptcy Court for the Middle District of Alabama, just 11 days after shutting down operations and closing doors.
A Chapter 11 hearing is scheduled today with Judge Dwight H. Williams Jr. presiding and Cameron Anthony Metcalf of Espy, Metcalf and Poston, PC out of Dothan representing Quantegy, according to Quantegy's docket of events for the day. According to the docket, the telephone hearings are scheduled for 2 p.m. Other details of the hearings were unavailable Wednesday.
"There are two very important things needed in restructuring - time and money. When you run out of cash - you're gone," said Richard Lindenmuth, Quantegy's CEO. "We declared Chapter 11 on Monday, to think about how to restructure. We want employees to be taken care of first, always. In the event we come out of Chapter 11, we've hired Equity Partners, Inc. to find new investors. There have been eight groups to visit the factory already, and each one has expressed continued interest in purchasing the company or potential new investors in it. I wish I could tell you that would happen, but I can't. I'm an optimist but the realistic thing is - we're struggling."
Opelika Mayor Gary Fuller said bankruptcy is not good news for Opelika Light & Power - now out roughly $250,000, which was owed to the department for past electric bills.
"We are in the 'unsecured creditor' category, which means we are not in a good position. I'd be surprised to see a penny," Fuller said. "Back in March of 2003, Quantegy had problems with cashflow and had asked the City of Opelika to work out a payment plan with them which Mayor (Barbara) Patton agreed to do, paying the city past due balance of $20,000 per month."
Fuller said that didn't make a dent in the money owed the light and power department.
"As I explained to Richard (Lindenmuth) two weeks ago Tuesday, $250,000 is probably just a chunk of change to him, but to us it's a lot of money," Fuller said. "Light and power is owned by the city, and the city is owned by the citizens and that's who ends up paying."
Fuller said the city would have already pulled the plug on electricity at the plant had it not been for environmental concerns of chemicals and hazardous material being there. He says the city would like to have the money it is owed, but more than that it would like for Quantegy to be back in business - producing tape, consuming electricity and contributing to the city's tax base.
"It's sad when people who have devoted their entire life to a company and then have it close with virtually no notice - it hurts more than just not getting a paycheck. It's about loyalty," Fuller said.
Lindenmuth said he saw the writing on the wall five years ago saying Quantegy has gradually spiraled down in profits with roughly $6 million in sales last year compared to $40 million, five years ago. He said just the plant's electric bill is sky high.
Ken Mann, exclusive broker for Quantegy and partner at Equity Partners, Inc., said Quantegy's recent filing of Chapter 11 could be a positive step.
"Essentially, the filing means that the company will get some 'breathing room' from creditors to remain open and satisfy customer orders while we continue to talk to prospective investors and purchasers," Mann said. "Our intention is to get to a sale transaction very quickly, and hopefully one that keeps the business as an on-going concern. We've had some good meetings with prospects over the last two weeks, and we are cautiously optimistic."
Collier Swecker, a tax attorney and partner of Swecker and Sparks, LLC in Opelika, said the hardest decisions are the ones made from the top. Although Swecker is not involved in this case, he says "from a business standpoint, sometimes you've got to do it."
"Look at the airline industry, companies do bounce back after bankruptcy all the time," Swecker said. "It's an opportunity to catch your breath. When you're headed toward a storm, you've got to be able to correct the course. Business is about trying to make a profit - I wouldn't want to work for someone who did not want to be profitable."
On Wednesday, Lindenmuth was quick to point out that Quantegy is not the only sinking ship in the industry.
"This is not just happening here - it's happening all over. The last two years, we started as a board and team to re-focus and redirect," Lindenmuth said. "This did not happen overnight, as much as five years ago we knew the industry was changing and had to take action. Last year, a major competitor in Germany, 10 times the size of our company went Chapter 11 and just disappeared. We've been trying for a long time to restructure, but we've had struggles."
Lindenmuth said he had been hopeful of cashflow a few years ago when Imation gave Quantegy a manufacturing contract to cover its expenses for two years when a new product, Digital Beta Cam, had been launched by Quantegy. But it was not smooth sailing.
"Imation people decided to build a factory and take 100 percent of their business away from Quantegy. There was no continuation of contract. That was the first blow, as it were," Lindenmuth said. "Then Digital Beta Cam, which was manufactured here, had quality control problems. DBC products kept being returned for faulty function. This contributed to the cash crunch we've had. We've since fixed the DBC problems but manufacturing of Imation is not coming back."
Still, he says he hopes Quantegy will come back.
Lindenmuth, who has been living here in a hotel for four and a half years away from his wife and four kids in North Carolina, says he will remain here for the duration.
"It's taken a lot longer to fix problems than first anticipated, but our employees always had a 'can do attitude.' We're fighting to bring this company back up with new investors, and I sure as heck hope it happens," Lindenmuth said. "This has been difficult for everybody. There's no easy thing about it. The employees were correct and good - (Quantegy closing) was not targeted toward them. It's the industry. There have been challenges. This is a wonderful community. There are really good people here in Opelika and Auburn. I hope to fix things and make it a viable company again. I'm not the kind of person who gives up."
Frank
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