United Steelworkers enters bankruptcy of Armstrong Flooring | Local company

The United Steelworkers attorney told an Armstrong Flooring Inc. bankruptcy hearing on Thursday that the union would be deeply involved and closely monitor the company’s sale process.

East Lampeter Township-based Armstrong Flooring is seeking Delaware bankruptcy court approval to sell assets and reorganize under Chapter 11 to settle $317.8 million in debt, including $160 million dollars of long-term debt. Armstrong said he had assets worth $517 million.

The iconic flooring manufacturer late last week warned all of its workers in North America that they could face permanent layoff as early as June 17 if the company does not find a buyer.

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Remarks from United Steelworkers attorney Richard M. Seltzer of Cole, Weis and Simon came during a hearing to determine the timing and procedures for the sale of Armstrong’s assets. Bids are due by June 14 and an auction is scheduled for June 16, with the option to postpone the sale of the Chinese and Australian assets until June 28. The deadline to enter into and file a Purchase Agreement with the winning bidder is June 17.

Among its assets are seven manufacturing plants in three countries. Two plants are in Pennsylvania, one in the city of Lancaster and one in Beech Creek Township, Clinton County. There are factories in Illinois, Mississippi, Oklahoma and a factory in China and Australia. The factories in China and Australia are not part of the bankruptcy but are for sale. It also has offices in Canada, which are part of the bankruptcy. Armstrong Flooring also operates a distribution center in California.

At the union’s request, bidding procedures have been changed to ensure that a “working” buyer declares its position on employee contracts, retiree benefits and pensions. An active buyer is one who wants to continue manufacturing flooring as opposed to one who would liquidate assets.

Armstrong Flooring’s turnaround consultant, investment bank Houlihan Lokey, said Wednesday it has 100 interested parties that have explored or are actively exploring participation in the sale process and that it has entered into 69 non-disclosure agreements. disclosure with these parties.

Houlihan Lokey said in a court filing that he also received four new proposals for various assets, including a competing bid for some of the North American and Australian assets, a bid for the Chinese and Australian operations on a going concern basis operations, an offer for a North American manufacturing plant on a going concern basis and another offer for the purchase of the Australian operations on a going concern basis.

The syndicate will also be allowed to attend the auction and be an advisory party for buyers of the facilities. Seltzer also said the union is willing to discuss contracts in appropriate circumstances under bankruptcy law.

United Steelworkers represents hundreds of employees at Armstrong Flooring plants in Lancaster and Jackson, Mississippi, as well as hundreds of retirees, Seltzer said. He said employees and retirees could be most directly affected in terms of employment and medical benefits.

Armstrong Flooring wants to end all post-employment benefits, including retiree life and health insurance, but will continue to make required payments until the case is resolved, which which is scheduled for a hearing on June 3.

In the event of bankruptcy, collective agreements can only be rejected or modified after the company has attempted to negotiate with the union. United Steelworkers Local 285 ratified a new three-year contract in March.

About 277 manufacturing workers in Mississippi and Lancaster are represented by various unions, including the United Steelworkers and the International Association of Machinists and Aerospace Workers, the company said. Armstrong Flooring also hires full-time and part-time independent contractors and temporary employees.

According to Armstrong, there are 215 employees at its facilities on Dillerville Road and Loop Road in Lancaster, and 391 are assigned to or report to Greenfield’s headquarters on Hempstead Road.

The Beech Creek plant has 27 employees who are not represented by a union. There are 81 workers in Mississippi and 128 in Oklahoma. The company also has workers in Illinois and California.

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