Manufacturer gets new lease on life

On Business

The wake of a corporate bankruptcy buyout can be chilly and choppy. Impersonal outside investors typically swoop in to tend to the injured enterprise, installing new management and taking the scalpel to payrolls and other expenses.

North Carolina businessman Larry Schwoeri says he's aiming to make an exception in his company's recent acquisition of a down-but-far-from-out Lowcountry business, preserving about 40 jobs and a 31-year manufacturing legacy.

"We've got a good leader here and a good team of people," Schwoeri said earlier this month. "It always starts with that."

Schwoeri heads Mid-State Machine Co. , a 100-worker maker of metal components that snapped up the former Bellwright Industries Inc. for $2.9 million last month in an effort to diversify its business.

"It was a pretty compelling story," Schwoeri said. "It's a good fit with what Mid-State does. ... We don't generally do troubled situations, but this one was just too good."

A key attraction was that Bellwright is equipped to handle more volume than Mid-State. "It ... allows us to ... do cross selling by offering customers a broader range of products," Schwoeri said.

While Mid-State is based near Mooresville, N.C., it's committed to keeping Bellwright — reconstituted as Bellwright Industries LLC — in Summerville, where it can better serve its industrial clients, including Cummins Turbo Technologies in Ladson and the Husqvarna Home Products lawn mower plant in Orangeburg.

Bellwright set up shop in Dorchester County in 1977 to capitalize on the auto industry's gradual shift south. It forged a highly skilled and reputable blue-collar business, but also saw its share of financial ups-and-downs. Its highly precise parts were sold through middleman to end users such as General Motors Corp.

The wheels began to come off at Bellwright after its best year ever, 2004, when revenue topped $25 million. That same year, a major contract with a vehicle supplier expired and was not renewed. Soon after, other auto-related jobs dried up, while equipment costs and other core expenses — namely steel, freight and energy — soared.

The cash-starved company, in debt to the tune of nearly $9 million, sought protection from its creditors through a bankruptcy filing in March. Mid-State emerged as the only viable buyer — and Bellwright's only hope for survival.

"I think most people in the industry know the Bellwright story and know the company has a great reputation technically," Schwoeri said.

He credited company veteran Ken Waterlander, who had been president and is now general manager, for keeping the doors open and the work force intact while maintaining relationships with customers. "He had been able to hold his team together," Schwoeri said.

For now, Mid-State's priority is to stabilize the business after several years of turmoil, cutbacks and uncertainty.

"We're going to stick to our knitting for the next year or so and take care of the customers we have," Schwoeri said.

Longer term, he's bullish on the company's growth prospects. Customers already have relayed "a clear message: Get this thing ... back on track and you can count on more business from us," he said.

"Gosh, there so many opportunities in the Southeast," Schwoeri said.

Bellwright's is still targeting auto-related companies, but only those that serve the commercial vehicle market. Not surprisingly, it is purposely steering clear of suppliers to the major car manufacturers, a brutal business that was the source of its recent financial skid.

"I don't think we're anxious to get back into that again," Schwoeri said.