Katy Industries gets new owner, name
Katy Industries, the bankrupt Maryland Heights-based manufacturer of commercial cleaning and consumer storage products, has been renamed now that its sale to two private equity firms has closed.
Los Angeles-based Highview Capital LLC and Chicago-based Victory Park Capital Advisors LLC announced Monday they had completed the buyout of substantially all of Katy Industries’ assets, which will be consolidated under a newly formed holding company they co-own called American Plastics LLC.
Katy filed for Chapter 11 bankruptcy protection in May, listing assets of $821,321 and debts of $58.4 million in court papers, with plans to sell most of its assets to Highview and Victory Park. After a bid process, the bankruptcy court approved the sale to Highview and Victory Park on July 17.
Previously, Victory Park had bought all of Katy Industries’ holding company’s stock in a $6.5 million deal in September 2016. Katy named new board members after 75 percent of its directors resigned following Victory Park’s buyout of the holding company’s stock.
In October, Katy fired its former CEO, David Feldman, who had led the company since 2008. Feldman later filed suit, alleging that he was not fired for cause, as Katy had stated. A hearing in that lawsuit is scheduled in September.
On Monday, Katy’s new ownership group said Robert Guerra, who was named Katy Industries’ president and CEO in November, would continue as head of the newly formed American Plastics LLC.
“For 50 years, Katy has established a strong reputation and popular brands by reliably providing quality products and services to its customers,” Ryan McCarthy, co-founder and senior portfolio manager of Highview, said in a statement. “Now, with a well-capitalized balance sheet and new funding, American Plastics is in a strong position to continue that legacy, execute on its strategic plan and enter a new era of growth.”
American Plastics will continue to operate under Katy’s brands, which include Continental Commercial Products, Contico, Wilen, Fundamentals and Fort Wayne Plastics, the new ownership group said. It operates injection molding and manufacturing facilities in Jefferson City, Missouri; Fort Wayne, Indiana; and Tiffin, Ohio, with additional distribution centers in Fontana, California; and Toronto.
Katy Industries did not file reports with the SEC for the first quarter of 2017 or fourth quarter and year ended December 2016. For the nine months ended Sept. 30, 2016, the company had reported a net loss of $8.7 million on net sales of $82.5 million, compared with a net loss of $4.6 million on net sales of $83.7 million for the prior-year period.
The company employed 301 people as of Dec. 31, 2015, according to its most recent annual report.