East Hills Business Park manufacturer files for bankruptcy, plans to eliminate almost 100 Lawrence jobs
photo by: Journal-World File Photo
Just two years after an expansion project, a Lawrence manufacturing plant is set to close, costing nearly 100 people their jobs.
API Americas announced in a federally required filing that it intends to close its manufacturing plant in the East Hills Business park within the next 60 days. The plant produces foils, films, holographic finishes and other such products that are used to create fancy packaging options for a variety of industries.
But fancy must not be as profitable as it used to be, because the company said in the filing that its business had taken a downturn. That’s despite the company completing a $750,000 expansion project in 2018 to increase production capacity at the plant, located at 3841 Greenway Circle.
“Over the last several years, our business has been faced with significant challenges,” Ken Bean, director of operations for API Americas, said in a letter included in the filing. “While we have worked to manage the changes and loss of customers, we can no longer continue as we have been.”
The filing made it clear that all API employees in Lawrence would lose their jobs, but the filing didn’t make clear how many employees were at the location. A spokeswoman with Steel Partners, which is the parent company of API Americas’ parent company, said she believed there were approximately 90 people employed at the plant.
And Jennifer Golembeske, a vice president with Steel Partners, said API’s industry had been negatively affected by a trend toward less packaging of products. API makes foils and other materials for packaging of products like greeting cards, liquor bottles, cigarettes and other items intended to stand out on retailers’ shelves.
“It is really just adverse changes in the industry and the loss of major customers that has led to this,” she said.
API Americas, which also used the Lawrence manufacturing plant for its corporate headquarters, filed for Chapter 11 bankruptcy protection on Sunday, Golembeske said. That followed an action last week by API’s parent company, API Group Limited, to seek the United Kingdom’s equivalent of bankruptcy protection. Steel Partners, which is publicly traded and based in New York, is overseeing the bankruptcy of API Americas.
Golembeske said the future of the Lawrence manufacturing facility and other holdings the company has in Lawrence would be determined by the bankruptcy process.
Steve Kelly, vice president of economic development for the Lawrence chamber of commerce, said he hoped the building could be retrofitted and put to use by some other manufacturer.
“We are very disappointed by the news,” Kelly said. “They have been a good company to have in the community and they produce a neat product. “The facility is in a good location, and it is one of the few locations in the park that has the physical space to expand. Whoever would take over that property would have room to do something else.”
The API announcement comes on the heels of Kmart announcing last week that it was closing its Lawrence distribution center near the Kansas Turnpike. That closing, also expected to happen in the next 60 days, will cost 111 Lawrence-based jobs.
Bonnie Lowe, president and CEO of The Chamber, told city commissioners at their meeting Tuesday night that the chamber and the Lawrence Workforce Center were working together to ensure individuals affected by the Kmart layoffs would have access to the services they need as they seek work.
Those efforts also are expected to be extended to the API employees.
“The hope is we find a replacement tenant that could provide some good jobs and be a great employer,” Kelly said.
Back-to-back layoff announcements in Lawrence aren’t common, and Kelly noted some positive developments on the local job front. Kansas City-based U.S. Engineering is still working on its plans to build a new facility at Lawrence VenturePark.
Construction work has not yet begun on the facility, nor have final plans been formally submitted to City Hall. But Kelly said the project was still actively being developed by the company, which will manufacture a host of specialty duct work products for heating and cooling construction projects. Kelly said he thought some of the delay in filing the plans with City Hall is because the company is considering building the facility a bit bigger than the 100,000 square feet that was initially proposed.
“That is good news, but that means it takes a little bit longer design-wise,” he said.
U.S. Engineering has already received approval from the Lawrence City Commission for an incentives package to locate in the business park on the eastern edge of town. As part of that application process, U.S. Engineering said it planned to have about 80 jobs at the Lawrence plant, with an average wage totaling $72,800.