Alabama Firm Offers to Buy Bankrupt Fort Wayne, Ind., Utility-Product Company
Published in: Knight Ridder/Tribune Business News
Date: 6/2/2003
By: Doug LeDuc
Jun. 2–FORT WAYNE, Ind.–A Birmingham, Ala.-based rival to Mobile Tool International wants to buy it out of bankruptcy for $20.5 million.
Mobile Tool has its headquarters in Westminster, Colo., and owns Fort Wayne-based MTI Insulated Products.
Last year, MTI employed about 160 at 9733 Indianapolis Road, primarily making insulated aerial lifts for utilities and other businesses whose employees work around power lines. About 20 percent of its production consists of cranes with digger augers for setting and replacing utility poles.
Last week, the U.S. Bankruptcy Court for the District of Delaware ordered an auction of Mobile Tool assets to take place June 10 at the Denver, Colo., law offices of Rothgerber, Johnson & Lyons, which is representing the company.
Court documents show Birmingham-based Altec plans to bid $20.5 million for Mobile Tool’s business and the majority of its assets.
“The only assets excluded is the real estate in Fort Wayne,” said Van Walbridge, president and chief executive officer for Mobile Tool. Altec is not expected to be the only bidder in the auction, he said.
Altec did not explain to Mobil Tool why it has structured its offer that way and would not comment last week on the bidding or its plans for the business.
In addition to its operations in Fort Wayne and Colorado, the company has facilities in Frederick, Md., and Laverne, Calif., Walbridge said.
Mobile Tool is winding down production in Fort Wayne and still has at least 30 of its 140 employees here.
Mobile Tool filed for Chapter 11 bankruptcy protection from creditors in the U.S. Bankruptcy Court in Delaware on Sept. 30. The filing listed it with $65.3 million in assets and $46.6 million in debt.
Walbridge said at the time additional liabilities on the company’s balance sheet bring the total to $56 million.
Assets listed in the bankruptcy filing include a little more than $10 million in plants in Colorado and Maryland that are old enough to “have zero value on the balance sheet,” he had said.
Walbridge blamed the bankruptcy on market conditions. Mobile Tool was formed through an employee buyout in 1995, and grew with the telecommunications industry as it expanded during the second half of the 1990s, he said.
But telecom growth peaked while Mobile Tool was acquiring additional inventory, including rental fleet units for its Fort Wayne-based business.
The electric-utility market also began contracting, and both sectors greatly reduced capital spending. Mobile Tool’s business dropped at least 50 percent.
The company cut costs by combining some product lines, closing and consolidating facilities and reducing its work force , which was near 1,000 before the cuts started.
Mobile Tool is discontinuing production here and consolidating its Fort Wayne parts and service operations at the company’s main manufacturing facility in Colorado.
Mobile Tool, which already had a small manufacturing operation here, acquired the Fort Wayne aerial lift business when it purchased the assets of the former TECO Inc. in February 1999.
Although it has some administrative and clerical workers, most MTI employees are welders and assemblers.
(c) 2003, The News-Sentinel, Fort Wayne, Ind. Distributed by Knight Ridder/Tribune Business News.
COPYRIGHT 2003 Knight-Ridder/Tribune Business News