Las Vegas manufacturer bankrupt, 75 jobs lost

Grace Leong

Thursday, April 4, 2002 | 11:08 a.m.

Las Vegas-based metal fabricator United Metal Technologies Inc. and its four affiliates filed Chapter 7 bankruptcy to close and liquidate the businesses, citing declining business from casino equipment makers and Silicon Valley technology companies.

The slowdown in orders was blamed on the aftermath of the Sept. 11 terrorist attacks and a slow economy.

UMT, headquartered at 365 East Arby Ave., filed for bankruptcy last week along with four affiliates: BPW Precision Metal Fabrication Inc. of Las Vegas, Peninsula Metal Fabrication Inc. of San Jose, Calif., Messina Metal Manufacturing Inc. of Sacramento and Unirule Industries Inc. of Santa Ana, Calif. Assets and liabilities were not listed in the filing.

UMT bankruptcy attorney Gregory Garman said he is still assessing the value of the companies' assets including their metal fabrication equipment and presses. He said UMT closed all its operations including two Las Vegas plants and three other factories in California on March 1.

Garman said UMT, which specialized in fabricating metal components including metal casings for slot machines, laid off about 75 workers at the two Las Vegas plants.

"Bankruptcy was the most expedient way to wind down the business," said Garman. "The recession and 9-11 attacks did them in. Orders for specific parts dried up. There wasn't much demand for new gaming equipment."

"The recession was particularly hard-hitting on the manufacturing and technology industries," he said. "Manufacturing was the first to feel the impact because in a slow economy, companies usually hold back or slow down on their purchases of large durable goods."

Garman said the company was also affected by the fallout in the technology sector last year because 60 percent of its business was generated by high-tech industries. Peninsula, Messina and Unirule provided several different types of metal processing and traditional sheet metal fabrication to Silicon Valley's semiconductor, telecommunications and computer equipment manufacturing industries.

Garman, who said UMT's liabilities are estimated to be in the "millions," said UMT and the four affiliates were placed under receivership on March 11 after they defaulted on more than $4.5 million in loans owed to Comerica Inc. of Detroit, their largest creditor.

"The loans were used to pay for working capital, buying equipment and part of it went to paying for UMT's acquisition of Peninsula Metal in 2000," he said.

Nile Leatham, Comerica's attorney, said the three loans made to UMT and its affiliates are collaterized by the companies' equipment, inventory and accounts receivables and had matured on Feb. 14.

"We're exploring options including liquidating the collateral," he said. "But there's also been some interest expressed in buying the factories and reopening them."

archive