68° M/CLEAR, At least 99 jobs cut; company backs out of buying Pender's Coty plant
Last Modified: Thursday, March 18, 2010 at 3:49 p.m.
Employees of the Coty Inc. plant in Rocky Point received a double whammy of bad news Thursday morning.
Officials announced they are closing the plant’s distribution center and transferring operations to a facility outside Columbus, Ohio. The 99 employees on the distribution side of the company are expected to be laid off in November and given severance packages.
The company also announced that plans for a New Jersey company to acquire the manufacturing side of the plant fell through over the weekend, leaving the future for 357 employees up in the air.
“It’s been a long day for us,” Coty General Manager Cary Newman said, noting employees were given half the day off to cope.
Medicia Holdings LLC informed local officials over the weekend that its deal to acquire the plant and invest $25 million had fallen through.
Newman said because of a confidentiality agreement with Medicia he could not comment on the company’s reason for backing out.
Coty bought the plant from Del Laboratories Inc. in 2007. It makes and distributes cosmetics and other personal care products. Pender County commissioners had been poised to offer the New Jersey company an incentive grant of up to $422,500.
Newman said Coty officials learned of Medicia’s inability to close the deal Friday and ended negotiations Saturday. He said ideally Coty would find another third party to take over the plant.
If that doesn’t happen, a plan will be put in place to close the plant, which could take eight months to a year.
Wilmington Industrial Development CEO Scott Satterfield said he has started looking for other buyers.
“We will and have begun addressing other opportunities to try and make sure that facility is utilized and is hiring people,” he said.
Coty is the largest private employer in Pender County, and the deal with Medicia was intended to save and create jobs. It was planned to be a $25 million investment that would create 542 permanent jobs at the plant.
Pender County Manager Rick Benton said he hopes they will find another buyer or bring Medicia back to the table.
“I think we’re optimistic for the future,” he said.
Benton said Pender County’s unemployment rate is more than 11 percent and that 60 percent of residents travel outside of the county for work.
“And the board of commissioners want to reverse that,” he added.
Satterfield said the Coty Inc. building is a world-class facility and if it is vacated it will be marketable.
Coty Inc. closed its Leland promotional assembly and returns facility in December, resulting in a loss of 90 jobs.
The Rocky Point facility is the only local Coty Inc. facility left. The company also has operations in Sanford, according to its Web site.
Benton said he doesn’t know of any specific companies interested in the plant.
“Although I understand there are others that are interested,” he said.
Benton said the county will offer incentives to any interested company based on job creation and investment levels.
Shelby Sebens: 343-2076
On Twitter.com: @ShelbySebens
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