CHARDON, Ohio-With the acquisition of its primary rubber component production assets complete, the former Chardon Rubber Co. is in negotiations to sell the rest of its operations.
The company, renamed CRC Rubber & Plastics Inc., is close to the sale of its plastics product business to an unnamed buyer and is in discussions with several companies on the purchase of its rubber custom mixing operation, according to Mark Kozel, managing director of the Cleveland-based Parkland Group Inc., which is handling the sale of the various assets of CRC.
CRC also has a good deal of rubber molding machinery on the selling block.
"We have a potential customer for the plastics business," he said. "The sale is imminent, subject to the approval of the bankruptcy court." CRC sought Chapter 11 protection earlier this year as sales dipped because of the recession.
Lines, name sold
CRC sold most of its rubber compression and injection machinery lines and related equipment to Wabtec Corp. for an undisclosed amount in late July, two months after it filed for bankruptcy court protection.
Also included in the sale was the company's name, its account receivables, rubber formulas, customer list and other equipment.
As part of that agreement, CRC for the past four months has been manufacturing products for Wabtec, which was formed in November 1999 when Westinghouse Air Brake Co. was merged with MotivePower Industries Inc. That pact, however, expired Nov. 22, according to Marian K. DeVoe, president and chief operating officer of the Chardon-based company.
She estimated that about 60 percent of the company has been sold.
A Wabtec spokesman acknowledged some assets of CRC were acquired but he did not disclose any specifics nor elaborate further. The company's rubber products operation has manufacturing facilities in Greensburg, Pa., and Strongs- ville, Ohio.
A number of parties have shown an interest in CRC's custom compounding division, but a deal with another company "is not as far along as the one for the plastics business," Kozel said.
"Our custom mixing business is significantly larger than our plastics business," said DeVoe, who joined CRC in 1982 and became president and COO in 2004. "Hopefully someone will buy it and keep it in Chardon. State, county and local agencies have come up with incentives to keep it here for a buyer."
The possibility exists that a deal for the rubber custom compounding operation could involve CRC's plant in Chardon, she said, which is also up for sale. But the sale of the business is not tied to the facility.
In addition to the plastics unit and the mixing division, DeVoe said CRC has plenty of rubber molding machinery available along with miscellaneous equipment spread throughout the plant that it intends to sell.
Tough economic times
The one-time rubber and plastics components manufacturer, formed by Jefferson W. Keener Jr. and other investors in 1978, filed for Chapter 11 protection at the U.S. Bankruptcy Court for the Northern District of Ohio in May. Keener, DeVoe's father, served as CEO for the last several years and is retiring.
After the bankruptcy filing, she said that CRC was implementing a restructuring plan that called for the sale of part or all of the company.
Poor economic conditions impacted the firm's sales for more than a year and limited the company's available working capital, which helped push the firm into bankruptcy, she said at the time. "The economies of scale favor larger companies with more robust resources than a company our size."
The company began laying off workers in May and since then its work force has been reduced by about 40. Only 23 workers remain, DeVoe said.
With the majority of its rubber product production operation sold to Wabtec, about the only manufacturing the company does is plastics components and systems. "We are continuing to mix rubber for companies with their own formulas," she said.
On the plastics side, DeVoe said CRC manufactures single, dual and triple durometer extruded seals and tubing, primarily for the transportation and appliance industries, along with gas tank straps and pressure switch tubing.