June 1, 2012
Cortland Line shareholders authorize sale
Company needs new financing or buyer
A majority of the 94 current and former Cortland Line employees who own the company supported its possible sale in voting that ended Saturday.
The company is owned through an employee stock program.
The vote authorizes the program’s trustee, company President Brian Ward, to make the best possible deal for shareholders.
The company is attempting to find either a new financial institution or possibly sell its assets, Ward said.
“Now we try to get the best deal we can,” Ward said. “We have to bring in new capital, sell it or find investors.”
Selling the company or entering bankruptcy will mean the end of the employee stock program, something the employees were aware of when they voted, Ward said.
Cortland Line has been in business for 97 years and employs 55 people.
The company has 2,500 line braiding machines in its 145,000-square-foot Kellogg Road factory.
It manufactures fly fishing lines, pull cords for toy companies and also has contracts to make products for medical and industrial companies, as well as the military.
The company took out several loans just as the financial markets crashed in 2009. The heavy debt load, combined with historically bad weather patterns in 2011, put the company in a dire financial position.
“The entire industry has taken a hit,” Ward said last week. “The economy has been hard and the massive weather patterns from a year ago have pretty much destroyed the tackle industry.”
Cortland Line recently received a notice of default on a $2.75 million loan from Berkshire Bank.
In a May 11 letter to the company’s shareholders, obtained by the Cortland Standard, Ward laid out the company’s position.
“Currently the company is in extreme financial difficulty and cannot continue to operate much longer in its present condition,” Ward wrote.”
Despite those problems, the company’s position is improving, Ward said Thursday.
“The fundamental problem is getting credit,” Ward said. “Our orders are up, this is one of the strongest years we’ve had. The viability of the business is strong, it is the lack of ability to finance it that is the problem. With the current bank yanking the loan and no local financial institution stepping up to the plate ... the fundamentals of the company are still strong.”
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