Genova announces plant closing, says sale possible

THOMAS DEAN STEWART | The Sun

Paducah's Genova Products plant has been idled since late last year after the company first suspended operations. On Tuesday, it announced the plant would close while a potential new buyer is sought.

Genova Products announced Tuesday it intends to permanently close its Paducah plant while continuing to seek a buyer for the company, which has local officials hopeful the plant's 100-plus jobs can ultimately be saved.

Joseph Pusateri, Genova director of operations, said in an email the company is sending out notices to comply with the U.S. Department of Labor's Worker Adjustment and Retraining Notification (WARN) Act. The act requires employers to provide 60 days notice of plant closings and mass layoffs.

However, Pusatari indicated Genova is covered by an exemption of the 60-day notice for a "faltering company," which covers a situation where a company has sought new capital or business in order to stay open and "where giving notice would ruin the opportunity to get the new capital or business."

Pusateri said Genova has agreed to the terms of a proposal from a potential buyer which is under review "and we hope to have some direction soon."

Local officials also are hopeful.

"I'm going to hold on to that part," said Sandra Wilson, president of the Paducah Area Chamber of Commerce and a city commissioner. "The fact they say they have a potential buyer ... that is good news. That could lead to the plant reopening, so I'm hopeful that'll happen."

Mayor Brandi Harless said City Manager Jim Ardnt and Bruce Wilcox, president/CEO of Greater Paducah Economic Development, have offered the same incentives to the potential buyer that Genova received and as far as she knows, the state has, also.

"I do know they (potential buyer) have been asking us questions about what it would look like if they came to Paducah, and we're being as welcoming as we possibly can," Harless said.

"I'm always cautious to be too optimistic about it, but I have heard that the company looking to acquire Genova is a very credible company that does not have a presence in the Midwest and is looking for some expansion opportunities.

"As long as they're a strong company, we definitely want them in our community," she said.

Holly Neal, a spokesperson for the Kentucky Education and Workforce Development Cabinet, said the state had not received a WARN notice as of Tuesday afternoon. When it does, Neal said, the cabinet can then initiate its "rapid response" team to provide additional resources to laid-off employees.

Harless said the city is always willing to host a job fair and community resource fair to help anyone who is looking for a job, not just former Genova employees.

Wilcox cautioned the process of finding a new owner and closing the deal could take some time.

"We've talked with the potential buyer on two different occasions and we're currently working with them," Wilcox said. "We've been in contact with them off and on throughout the whole process.

"Nothing happens at the speed of light, especially in big deals like this where there are a lot of parties involved.

"I'm still very hopeful that we can get something done," he said.

Genova announced Dec. 5 that it had suspended operations in late November due to a "raw material shortage ... that lasted longer than originally anticipated."

Pusateri said Tuesday the company maintained its operations "until such time the bank no longer provided funds for raw materials, and did so with no reasonable notice. Our singular objective was to get the plants up and running at all locations so all of our employees could return to work."

According to Pusateri, the company's efforts to restore funding and operations "were hurt by our internal challenges being so well publicized in the news and social media. As customers and suppliers learned of our issues, they became wary of continuing to further our business relationships."

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