Monday, January 21, 2002
Kalnow says bid to purchase National rejected
One bid to purchase the assets of the National Machinery Co. has been rejected.
Andrew Kalnow, who last week announced an offer by a group comprised of his family members and Alpha Capital Partners Ltd., on Sunday reported that the offer had been rejected by National's "senior creditors."
Those creditors are comprised of seven banks. Their decision to cut off credit to National Machinery resulted in it closing Dec. 28, sending employees home and shutting off pay and benefits.
A few employees have been called back to take care of serving customers who already have National machines. The company makes metal forming equipment used in industry.
Kalnow said the investor group he represents - NMC Acquisition LLC - is "extremely disappointed" its bid was rejected. The said the offer was made "for the purpose of fully re-opening the business of National Machinery and restoring the company under a much less debt burdened balance sheet."
He said the proposal was revised and improved several times during the past week after he learned that Citicorp Venture Capital Ltd. - which in 1998 bought controlling interest in National Machinery from the Kalnow family - had submitted a competing proposal.
Kalnow's statement Sunday said, "I don't know that it is a done deal yet with Citicorp, as they have to complete their proposed transaction. I only know that we have been told that our proposal was rejected in favor of Citicorp's because of all the technical advantages that it gave. I think Citicorp has about 10 days or so to make good on their proposal."
He added, "If the actions of the senior lenders and Citicorp serve to permanently re-open the business and allow for a revitalization of the company, then we feel that our efforts will not have entirely failed. The re-opening of National Machinery as a financially strong company is the real goal. We feel that re-employment of National's people and the well-being of the Tiffin community is most important."
National President Paul Aley last week said many interested investors have been in contact with the management team.
He said managers are trying to find the best offer.
"We're encouraging the best solution we can," he said, "to employ as many people as possible as soon as possible."