PVC plumbing maker Genova Products Inc. has closed factories, laid off workers and ended medical benefits in the past two months as the company faces a financial crisis and what officials have called a shortage of raw materials.
The owners would seek to sell the business or find a cash injection.
Genova officials did not return phone calls to its headquarters in Davison, Michigan, near Flint. But reports in local newspapers and television coverage said the company made significant layoffs or closed facilities in November, December and January in Paducah, Ky.; Fort Wayne and Rensselaer, Indiana; Faribault, Minnesota; and Sparks, Nevada.
Genova, which has not filed any layoff notices as of January 30, has laid off several hundred employees. Workers told local news outlets they were not given advance notice.
The company released a statement to employees Dec. 30 saying it was ending medical benefits, effective Dec. 31.
A professional magazine, HBS Dealerreported on January 29 that the Fort Wayne plant had closed and employees had been laid off. HBS Dealer issued a layoff notice for a Fort Wayne employee that read, “Over the past few months, Genova has faced various economic challenges. These challenges culminated in the issuance of a letter by Genova’s secured lender advising Genova that it was in default of its loan covenants and confirming that no additional funding would be provided to Genova for its operations.Over the past few months, Genova has worked tirelessly to try to find a strategic partner to either purchase Genova’s assets and continue its operations, or inject the necessary capital into Genova’s operations.
HBS Dealer reported that the letter indicated that Genova expected the closure of Fort Wayne to be permanent. The publication covers the hardware and building materials industry.
In an article published in early December, Joseph Pusateri, operations manager of the Paducah plant and veteran of Genoa, recounts The Paducah Sun newspaper that operations there were suspended at the end of November because he said there was a shortage of raw materials. He said company officials are looking to resume operations as quickly as possible.
Pusateri could not be reached for comment for this story.
Genoa has played a key role in the history of plastic plumbing products. The company was founded in 1962 by Robert F. Williams, a master plumber. It started out as a small plumbing supply house. Williams came up with the idea of selling plastic pipes, initially to cottagers in northern Michigan, because new plastic pipes were prohibited by building codes. Cabins were not covered by the codes. He bought the pipe from extruders, developed complete kits and sold them to cabin owners as DIY projects.
Genova began extruding its own pipe fittings and injection molding. Williams fought to change building codes to allow plastic pipes. His son, Robert M. Williams, is chairman and chief executive officer.
According to Plastics News ranking data, Genova estimated sales at $135 million. The company also manufactures PVC gutters and terraces.