Firm buys glassmaker for $3.25 million
PITTSBURGH — A private equity firm outbid two other companies for the assets of bankrupt Dlubak Corp. at an auction Monday in U.S. Bankruptcy Court in Pittsburgh.
Colorado-based Grey Mountain Partners bested glass fabricators General Glass International, of Secaucus, N.J., and the U.S. subsidiary of Oran Safety Glass Israel for Dlubak’s glassmaking business with a bid of $3.25 million.
The sale is to close today. As part of the sale, Grey Mountain is assuming a $130,000 liability arising from employees’ accrued vacation time. It also will extend a collective bargaining agreement with the United Steelworkers, which represents hourly production employees, for the next three months, allowing time for the union and the firm to try to come to terms on a new labor agreement.
Grey Mountain’s bid had been matched monetarily by Oran Safety Glass, but it ultimately lost out because it said it would need four days to close on the sale as opposed to the one day needed by Grey Mountain.
It is costing Dlubak roughly $15,000 to $20,000 a day to continue to run the business, and a four-day delay would have meant $60,000 to $80,000 less for its creditors.
Dlubak is a maker of architectural glass and blast-resistant glass for use in combat vehicles.
In court filings, Dlubak said the decision to seek bankruptcy protection followed three straight years of declining sales. The company filed for Chapter 11 bankruptcy in August, seeking protection as it looked to sell the business.
Through a prefiling marketing effort, it connected with Grey Mountain, which agreed to serve as a stalking-horse bidder on an initial offer of $2 million.
General Glass later replaced Grey Mountain as the stalking-horse bidder with an offer of $2.2 million.
Monday’s auction did not include Dlubak’s real estate assets, primarily its 100,000-square-foot plant and the 11 acres of land it sits on off Route 22.
To encourage the buyer to keep the business here, the Indiana County Development Corp. has been looking at acquiring the plant and leasing it back to the new owners.
In this case, it is considering buying the plant for roughly $1 million and renting it back to Grey Mountain for around $9,000 per month under a triple-net lease of at least five years.
The development corporation’s board is to vote on the move during a meeting this afternoon.