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September 07, 2010 02:00 AM

Sperry & Rice realigns Indiana, Ohio sites

Bruce Meyer
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    BROOKVILLE, Ind.—Sperry & Rice Manufacturing Co. L.L.C. is realigning the production of its two factories, a move that will mean employment growth at its Brookville unit but layoffs at its Killbuck, Ohio, operation.

    The maker of rubber seals and hoses for the appliance, automotive, and truck and bus industries is taking advantage of some state and local incentives that will mean the addition of roughly 40 jobs at the Brook-ville factory.

    The restructuring will see the Indiana facility focus on profile extrusions along with cellular seal and gasket products, while the Ohio unit will continue to make hose and formed products, according to President and CEO Jim Gregory. The Killbuck factory will see its employment cut to 55 from 117.

    “There will be some balancing between the two plants,” he said. “In the process, we're really aligning each plant with its core strengths.”

    Sperry & Rice currently employs about 60 in Brookville, with another 15-17 on layoff, Gregory said. Most of the 40 new jobs will be hourly positions—with those on layoff being brought back first—while a few of the new spots will be salaried.

    Some equipment will be transferred from Killbuck to Brookville, with no new machinery needed. “We'll really start moving forward pretty quickly,” he said. “Over the next 60 to 90 days we hope to put most of this in place.”

    Gregory said Sperry & Rice considered all factors when looking to restructure its operations, including plant size and capability, and available incentives.

    “It's sort of a bittersweet thing,” he said. “We're increasing employment in one place, which is a positive thing, but it hits the other facility pretty hard. That was a difficult thing to do to reach that decision.”

    As for the incentives, the Indiana Economic Development Corp. offered Sperry & Rice up to $200,000 in performance-based tax credits based on the company's job creation plans. Frank-lin County—where Brookville is located—said it will consider additional property tax abatement at the request of the Franklin County Economic Development Commission.

    In addition, Sperry & Rice will receive a $500,000 grant from the city of Law-renceburg's Regional Economic Development Grant program, which was funded from riverboat gaming money for the economic benefit of the 10-county region.

    Gregory said the company had approached Ohio as well to see what assistance was available, but there definitely was a difference in what the states were willing to do. “Indiana does seem to be pretty business oriented,” the CEO said.

    Sperry & Rice also received incentives in 2009 from Indiana that helped it purchase the appliance component extrusion business of Derby Cellular Products Inc. and move machinery from Connecticut to Brookville.

    “Indiana is competing and winning investment from companies that are looking to consolidate and more efficiently run their business,” said Mitch Roob, Indiana secretary of commerce and CEO of the IEDC.

    Gregory started at the Brookville operation in 1997, running the facility. It was owned by a holding company that in 2004 was looking to sell some of its operations. He and Tom Sander—the company's chief financial officer—bought Sperry Rubber & Plastics' operation in Brookville and Rice Chadwick Rubber Co. in Killbuck, forming Sperry & Rice Manufacturing.

    Business definitely has improved this year, especially in some markets that were weak last year, Gregory said. “As we go through 2010, we've seen business increase significantly. The appliance industry has made a pretty good turnaround, and the truck and bus market also seems to be doing better. There's new life in the auto industry as well.”

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