May 2, 2014 10:52:27 AM
Sanderson Plumbing has a potential buyer.
Woodflour Corporation of Chicago has made a $2.75 million offer to purchase the Columbus company that began manufacturing toilet seats on Tuffy Lane Road in 1940.
The company filed for Chapter 11 bankruptcy last October. A federal judge in Aberdeen is scheduled to decide on whether to accept the Woodflour bid Tuesday, according to court documents.
If the judge approves the bid, the next step will be an auction, at which other companies can out-bid Woodflour, according to Fred Cross, managing director of Heritage Equity Partners.
Sanderson Plumbing owes more than $2.8 million in unsecured claims to creditors, according to court documents. The majority of Sanderson Plumbing's 250 employees has been laid off and the company's production came to a halt Tuesday, according to CEO Tom Whitaker.
Cross, whose business helped facilitate the bid process, said he anticipates approval of the Woodflour bid, which would put the auction in late May or early June. Cross believes Woodflour's intention is to keep the business going.
"I have no reason to believe anything else," Cross said. "It is my hope they'll buy the company, close sometime in early June, buy the raw materials to re-prime the engine and within two to three weeks be up and running again."
Cross said nearly 100 companies have shown interest and signed non-disclosure agreements so they can access data and get as much information as possible on the company in preparation of making offers. He estimated fewer than 10 of those would consider overbidding Woodflour's initial bid.
Whitaker said they hope to have plant operations resuming this summer, but it is uncertain how many employees the plant would have when that happens.
"We are still shipping product and will continue for the next week to 10 days," Whitaker said Thursday. "As soon as we have a new owner, we will notify our employees and customers and start production again. Hopefully that will be soon."
About 100,000 seats a month had been produced at the 360,000-square-foot facility. Of those, 80 percent were from scrap wood received from local wood processors. The remainder are made out of plastic. Fifteen years ago, the company was making about 1 million seats a month and had 900 employees.
Cross said he hopes the plant is back in business soon and Whitaker will remain involved going forward.
"We're dealing with a company that is currently shut down," he said. "Those customers they have and still want their product, they're put in a position right now where they almost have to go elsewhere to look for that product. The quicker we can open the doors to the company, the more those customers they'll be able to save."
Nathan Gregory covers city and county government for The Dispatch.
1. Photo of responding MSU officer goes viral STARKVILLE & OKTIBBEHA COUNTY
2. City to limit hours for some stores COLUMBUS & LOWNDES COUNTY
3. Former MSU student's attorney speaks out STARKVILLE & OKTIBBEHA COUNTY
5. Wynn calls for school board head to resign STARKVILLE & OKTIBBEHA COUNTY