Volume 44, Issue 2 - February 2009

Company News

Serious Materials Acquires Republic, Kensington for Commercial Production 

On January 16, Kevin Surace, president and chief executive officer of Serious Materials, based in Sunnyvale, Calif., told USGlass of the company’s plans to purchase bankrupt Republic Windows and Doors (see January 2008 USGlass, page 14, for related story). Less than a week later he announced the acquisition of the assets of the former Kensington Windows. 

Serious serves the commercial market and the retrofit segment of the residential segment and focuses on high R-value, energy-efficient products. Surace has said that these once purely residential-oriented door and window facilities soon will be put to work producing both residential and commercial glass products. 

Serious plans to reopen the Kensington plant prior to the end of this month, installing new equipment to make “super-insulating” windows and commercial glass. The company will rebrand the products from Kensington Windows to Serious Windows immediately. 

Kensington Windows, based in Vandergrift, Pa., produced vinyl replacement doors and windows, and closed in October when parent company Jancor Co. lost its financing and filed for bankruptcy.

“We are committed to getting this plant re-started and back in operation as quickly as possible. We want to get people back to work,” says Surace. “While building material companies that make commodities are having a hard time in this downturn, we continue to expand operations and hire more people for our unique energy saving products.”

With regard to the Republic facility in Chicago, Surace says the company simply is “awaiting approval by the bankruptcy judge and the trustees.” He says the plan is to bring back Republic’s workers over time; he notes that they can’t all be brought back on day one, but he does plan to do so as business increases at the Chicago plant.

“We are all hopeful about the possibility of Serious reopening our plant. This would be a very happy ending to our struggle,” commented former Republic worker and United Electrical (UE) Workers Local 1110 vice president Melvin Maclin.

When asked about Republic customers who moved their business to Echo Windows, and whether they will come back to the company, Surace says, “I’m sure some dealers will stick with the new company and some will come back. But our focus will be to get people into high R-value products.”

Surace also commented briefly when asked about the reports that Richard Gillman, former owner of Republic, took equipment from the Republic plant to his new company, Echo Windows in Red Oak, Iowa.

“When you have a bank involved, you can’t take things out of there, so that will all have to be figured out. When you walk through the plant you can see lines that are missing,” says Surace. “But that’s between the former owners and the banks who gave them credit. It really doesn’t involve us directly.”

Looking toward the future, Surace acknowledged that additional acquisitions are not out of the question.

“We continue to look at everything that’s on the market today,” he said, adding, “so certainly we’re looking at commercial glass businesses as well.” ❙❙➤ www.seriousmaterials.com

Vitro America Consolidates Facilities in California

Memphis, Tenn.-based Vitro America has consolidated three existing Los Angeles-area operations into one large facility in City of Industry, Calif. The consolidation of the branches into one 125,000-square-foot operation, 15 miles east of Los Angeles, is expected to streamline service on distribution and fabricated products.

“Remember, we were two separate divisions—South and West—and in April 2006, we announced a consolidation into one division. As a result, we have made some changes that are more in line with how we do business in what was Distribution South (everything from Texas, east),” comments Alice Dickerson, director of sales and marketing. “The West, for example, had ‘call centers’ that handled calls for numerous locations. South had designated customer service representatives at each branch …”

In late January, Vitro’s parent company announced that it would not make several scheduled payments on February 2—leading to a default on several loans. The company had a payment due of $12.9 million for a loan ($300 million in principal) scheduled to be paid off in 2012 and $31.9 million for a loan ($700 million in principal) scheduled to be paid in 2017. In addition, the company has a $126 million outstanding balance in principal on another loan, due in 2013.

Under the terms of the company’s agreements, a default allows the creditors to declare all three loans, including both principal and accrued interest, to be “immediately due and payable.”

Company officials say “they intend to maintain operations and continue business relationships with its customers and suppliers as they seek to restructure debt.”

Vitro also has initiated discussions with investors, bondholders and creditors “to achieve an organized financial restructuring to improve its balance sheet,” but notes that “there can be no assurance that the [its] discussions with the Counterparties [investors], its bondholders, and other creditors will be successful.”❙❙➤ www.vitroamerica.com

USG
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