Tire Business staff report
Leavittsburg, Ohio -- Denman Tire L.L.C. has filed for Chapter 7 bankruptcy and will liquidate the company, putting about 260 employees out of work.
Sanford Pensler, Denman Tire ceo and president of Pensler Capital Powder Corp., which is majority owner of Denman, filed an action waiving notification of a meeting of officers of Denman over the issue and, as managing member of the company, began Chapter 7 proceedings. Mr. Pensler has hired the law firm Friedman & Rummel Co. L.P.A. in Youngstown, Ohio, to represent the company in the Chapter 7 case, which was filed with the U.S. Bankruptcy Court, Northern District of Ohio.
A Denman officer alerted Tire Business via e-mail today that he has â€œjust been informed that Denman has filed a Chapter 7 liquidation this morning. I have no more information than that, except that there is nobody working at the plant, office or warehouse at all.â€
Leavittsburg-based Denman, a Delaware limited liability company, has struggled for more than a year to refinance its debts or secure a buyer, but to no avail. In early March, the 91-year-old tyre maker said it had issued notification to employees and other affected parties of a tentative closing of its operations in accordance with the Worker Adjustment and Retraining Notification Act (WARN) of 1988. At that time it did not give a deadline for finding a buyer or financing but confirmed that, under WARN, the operation could close as early as mid April.
The permanent shutdown means Denman's construction, agriculture and mining tyre factory in Leavittsburg and its warehouse in Austintown, Ohio, are closed.
In its Chapter 7 filing, Denman listed the following equity security holders:
* Pensler Capital, Princeton, New Jersey--76.5 percent;
* Interco Investment Group L.L.C., Rayne, Las Vegas--20 percent;
* Gary Hudson, Celina, Ohio--1.04 percent;
* Charles R. Wright, former Denman president and ceo, Hendersonville, Tennesse--1 percent;
* Scott Tackett, Cortland, Ohio--0.93 percent; and
* Joseph Fallon, Marlton, New Jersey--0.5 percent.
Denman, which marked its 90th anniversary in 2009, reported last April that it had substantial losses from October 2008 through February 2009. The company unsuccessfully sought a $3 million (Euro 2 million) loan or more federal government contracts to remain afloat last year and survive the ongoing recession.
The company, which was acquired in 1996 by Pensler Capital, had estimated sales of $75 million in fiscal 2008. It produced more than 1000 different sizes and types of tyres, with its Leavittsburg plant having a capacity of more than 2400 units per day.
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Tire Business (a Crain publication)
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