Employees' Effort To Buy Out Pipe Organ Factory Fails
Sep. 11, 1992
HAGERSTOWN, Md. (AP) _ An employee buyout plan has failed to rescue the financially troubled M.P. Moller Inc., once one of the world's largest pipe organ makers, a union consultant said Friday.
The plan to save the 117-year-old factory collapsed because of a shortage of investors, said Mike Dreisbach, who was hired by the union to help reopen the plant.
''Earlier this week, the deal came apart when we were unable to place together a credible management team that had market, customer and investor competence,'' Dreisbach said.
''Therefore, this high-risk investment, which involved good faith from the various agencies and private investors, was considered to be much too risky and the decision was made not to proceed forward,'' he said.
Moller closed in April, but the company said it would try to reorganize and possibly sell the firm. Dreisbach said it was plagued by high costs and poor management.
In July, employees unveiled a $2.4 million plan to reopen the factory. The union agreed to lend $500,000 from its pension fund, cut the work force of 100, temporarily work 50-hour weeks for 40-hour pay, and combine some worker tasks.
The plan had much local support, Dreisbach said. Washington County, the city of Hagerstown and the state pledged money to help the plant reopen, and the rest was being sought from private investors.