Victor Insulators files Chapter 11

Will Astor//September 19, 2008//

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Victor Insulators Inc. has asked for court protection from creditors.
The manufacturing fi rm fi led a Chapter 11 petition in the Western District of New York Bankruptcy Court’s Rochester office this week. The petition does not state assets or liabilities.
In a court filing, Victor Insulators CEO Ira Knickerbocker names the firm’s inability to meet obligations incurred under its defined benefi t pension plan as “the major long-term factor which has contributed to the (firm’s) decision to file Chapter 11.”The company’s liabilities under the plan are being calculated but are believed to amount to some $8 million. Pension-related Internal Revenue service claims would push that debt higher, the filing states.
Victor Insulators employs roughly 120 at a 280,000-square-foot plant on Maple Avenue in Victor. It makes porcelain insulators for electric utilities. It has been in business there since 1893 and holds the third-largest share in the U.S. market, Knickerbocker states in the filing.
In 2004, Victor Insulators employed
more than 200, ranking it the area’s 34thlargest manufacturing fi rm. In the court fi ling, Knickerbocker partly blames the company’s financial straits on “dumping” by aggressive foreign competitors.
Such competition cut heavily into insulator manufacturers’ sales over the past 15 years and forced the Victor firm to cut staff and renegotiate a contract to cut union workers’ pay 20 percent, Knickerbocker states.
Conditions improved somewhat in recent years, however, Knickerbocker states.
Recent court decisions including U.S. Supreme Court rulings could give Victor Insulators room under Chapter 11 protection to negotiate its pension-related obligations down to a more manageable sum, however, Knickerbocker states.
Victor Insulators bankruptcy attorney Daniel Brown of Damon & Morey LLP in Buffalo could not be reached for comment.
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09/19/2008 (C) Rochester Business Journal