The founder and CEO of recycled rubber compounder Rouse Polymerics International Inc. has put the company's assets up for sale, citing its inability to overcome a devastating accident and bankruptcy.
Michael Rouse, who has owned the Vicksburg business-once Rouse Rubber Industries Inc.-since 1988, confirmed July 7 the company is for sale. A classified advertisement seeking potential buyers for the company's business and assets appeared in the July 6 ``Wall Street Journal.''
Rouse Polymerics has been in turmoil since a May 16, 2002, explosion and fire destroyed the Vicksburg plant, killed five workers and injured seven others. While Rouse attempted to rebuild his business and outsource production to meet his customers' needs, lawsuits-from victims and their families, a vendor and the company sharing a cinder-block firewall with Rouse Polymerics at the time of the explosion-began to pile up.
Rouse decided to refocus the company on high-end polymers and powders derived from recycled rubber and smaller markets, and built a state-of-the-art 13,000-sq.-ft. facility to house the operations on the Vicksburg property. The new plant opened in the spring of 2003.
The specter of the accident, the resulting lawsuits, and the difficulty of the company to secure adequate, affordable financing made the road back difficult, Rouse said. So on Aug. 12, Rouse Polymerics filed for Chapter 11 federal bankruptcy protection.
``The accident hindered the company from getting loans, and when we could get them, the lenders charged exorbitant interest rates,'' Rouse said. ``It became impossible to do business the way we wanted.''
While Rouse and his employees have kept the operation going, the product has remained high-quality and the facility has passed several Occupational Safety and Health Administration inspections, he said. But the difficulties have remained, Rouse said.
``It's just a business decision now,'' he said.
Rouse envisions an outstanding opportunity for someone or some company. The upside for whoever buys Rouse Polymerics is, ``It's still a great company and business,'' he said. ``There's a need out there for what we do, and we've always had good customers.''
Rouse Polymerics is a much different company than the one that existed before the explosion. That version had 100 employees. The plant ran five days a week, 24 hours a day, producing up to 4.5 million pounds of material per month, Rouse said.
Today, the company is run by a handful of hourly and salaried employees, and Rouse does technical sales and some other duties himself. The ``new'' operation wasn't built for volume, anyway, he said, but it's hardly the same place.
``It wasn't something you could foresee,'' he said of the impact of the accident. ``We were profitable, we had good cash flow. If the year (2002) had played out, we would've had revenues around $17 million.''
The deaths and injuries the accident caused always will be the biggest blow, Rouse said. ``I can lose my business, but the loss of life that occurred, the people that were hurt, you can't trade that for anything,'' he said.
Despite the changes, Rouse Polymerics has stayed committed to quality and service, Rouse said. ``It's always been our philosophy, our mission,'' he said. ``We can't sacrifice it for anything.''
It will be up to the potential buyers in their due diligence to determine whether the lingering aspects of the explosion and fire will affect their attempts to continue the business, Rouse said. It also will be their decision whether to relocate the company, he said.
``I want to help Vicksburg, I've always wanted to help the community here,'' he said. ``But that will be out of my hands.''
Rouse said he'd like to have something definite on the table within 90 days, and he knows there are some interested parties out there. The U.S. Bankruptcy Court in Jackson, Miss., must approve any asset sale.
After a deal is finalized, there are other possibilities for the 63-year-old Rouse. He said he'd like to act as a consultant to the new owners, helping them get adjusted and offering technical advice.
If that doesn't work out, there are always other opportunities a man with his skills and technical background can offer. Rouse recently helped write a book, and he'd like to finish work on a doctorate in the future.
``I'm going back to Oregon, but I want to stay involved in the industry and pass on whatever knowledge I can,'' he said. ``We'll have to see how things play out.''