March 30, 2009-- Casual Living,
Meadowcraft, Inc., the nation’s largest manufacturer of outdoor wrought iron furniture, faces a Chapter 11 involuntary bankruptcy petition, filed March 20 in Delaware by a core group of New York banking creditors.
Meadowcraft had been negotiating with Wells Fargo, RZB Finance Limited and Burdale Financial Limited for some time and believed resolution was imminent before the petition was filed.
“The banks have really been squeezing us for about four weeks now,” CEO and Chairman Sam Blount said. Despite that, he said he reached an agreement with the banking groups on March 26.
“I’ve been in this business for 29 years – almost 30 years – and the company has never been in a stronger position,” Blount said. “We’re ahead of last year; I’m shocked at how well we’re doing this year. We are exerting all efforts to provide as much work as possible for our 1,300 Alabama employees.”
Blount assured employees of his personal commitment to the Birmingham, Ala.-based company. “Our future is bright with pre-sales commitments for 2010 at an all-time high, the addition of the Tommy Bahama line and new cutting-edge designs and programs at both our iron and cushion facilities,” Blount said. “We are positioned to meet the production and shipping needs for the remainder of the 2009 season and beyond.”
In a March 11 memo to Meadowcraft employees, vendor partners, customers, sales reps and lending institutions, Blount announced that Jerry Camp, former president, and Larry Maynor, chief financial officer, were no longer with the company. Accounting irregularities were reported to the U.S. Attorney General’s office, according to Blount’s memo.
On the same day the bankruptcy was filed, about 30-40 Meadowcraft workers gathered outside the entrance to its Selma, Ala. plant, seeking their pay checks, according to a report in The Selma Times-Journal. Workers told reporters they were uncertain they would receive checks. Later, a representative from management arrived at the gate and told the workers there “the bank has funded your checks, come and get them.”
Workers also received a letter, which said the company plans to continue to operate and provide employment. The letter also provided an information hotline to workers about paycheck availability and work schedules.
“As you are aware, Meadowcraft has struggled during the current economic turmoil that is affecting virtually every company throughout the world,” the letter said.
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