Bankruptcy Court May Consider Springfield's Interests
04/30/02 12:00AM By Steve Zind
(Host) This is a critical week for efforts to save hundreds of jobs in Springfield. A bankruptcy court in Delaware is set to rule on whether to expedite the sale of equipment owned by the Goldman Industrial Group. The ruling could pave the way for a company in the Midwest to dismantle much of what remains of Springfield's machine took industry.
VPR's Steve Zind reports.
(Zind) When Goldman filed for Chapter 11 bankruptcy in February, the company closed two major plants that had been the backbone of Springfield's machine tool industry. Since then former employees and local groups have been working to find buyers willing to restart the plants and keep the jobs in Springfield.
At the same time other potential buyers have been looking at the facilities with an eye toward purchasing the equipment and moving the operations out of state. Last week, an Illinois company proposed to do just that when it made a bid to buy the equipment, but not the buildings or the real estate. Goldman has asked the court for swift approval of the offer. If the court goes along, a sale could be approved by May 16.
Pat Moulton Powden is with the Springfield Regional Development Corporation. She says just over two weeks is not enough time for those working to keep the plants in Springfield:
(Powden) "We're working with a number of parties who are interested in buying either all or parts of the businesses and keeping them local and they need adequate time to get financing approved. In some cases, buyers are working with either state or federal sources that need at least 30 days."
(Zind) Last week, Vermont's congressional delegation asked the bankruptcy judge to give special consideration to any buyer willing to keep the plants in Springfield. But will the court consider arguments that losing the plants would be a big blow to the local economy?
(Powden) "I sincerely hope the answer to that question is 'yes.'"
(John Carroll) "The court certainly can indirectly weigh such factors, but most sales are subject to the highest and best bid."
(Zind) John Carroll is a Wilmington, Delaware, lawyer who handles cases before the bankruptcy court. Carroll says the court is concerned primarily with the bottom line. He says unless keeping the plant in Springfield would help pay off Goldman's creditors, the court isn't concerned with the bankruptcy's impact on the community.
(Carroll) "That's a difficult thing for the bankruptcy court to weigh. And indeed, there is some case law out there that prevents such considerations."
(Zind) Carroll says the court's decision to expedite the sale of the Springfield plants depends on a number of considerations. He says the judge will weigh factors like how long the creditors have been waiting and how long the bankrupt company's assets have been on the market. The court's decision is expected Thursday.
For Vermont Public Radio, I'm Steve Zind.