Manufacturer to close at cost of 111 local jobs
Published: Tuesday, July 30, 2013 at 9:34 p.m.
Last Modified: Tuesday, July 30, 2013 at 9:34 p.m.
A company that recently acquired a Gainesville plant that manufactures medical needles is closing the plant and moving production to its facility in Athens, Texas, eliminating 111 local jobs.
Argon Medical Devices, based in Plano, Texas, acquired the plant in April as part of a $363 million purchase of Vancouver, British Columbia-based Angiotech Pharmaceuticals' Interventional Products Business that makes biopsy products.
Argon officials told local employees about the decision at a June 4 meeting at the Gainesville plant, according to a written statement from Argon. The company filed the Worker Adjustment and Retraining Notification required of large layoffs on Monday.
The move will happen gradually over seven to 10 months, the company said.
Further questions were referred to Bill Morgan, vice president of operations, who was unavailable for comment Tuesday.
The local plant started in Gainesville in 1986 as Medical Device Technologies, or MD Tech, as a subsidiary of Niles, Mich.-based National Standard Inc. One of its first products was a needle for breast tumor biopsies developed by a Shands Hospital physician.
In 1990, MD Tech was purchased by The Marman Group of Chicago and soon after merged with Manan Medical Products.
In 1998, MD Tech built a $2.5 million, 43,000-square-foot manufacturing facility at 3600 SW 47th Ave., behind the 34th Avenue Post Office, where it continues to operate for the time being.
Manan and MD Tech were acquired in 2003 along with other companies by American Medical Instruments Holdings, which was run by what would later become Argon's management team. AMIH investor RoundTable Healthcare Partners created the Interventional Products Business and sold it to Angiotech in 2006. The division had $101.6 million in revenue in 2012.
Argon, which is a portfolio company of RoundTable, bought the division from AngioTech.
The acquisition also included manufacturing facilities in Stenlose, Denmark, and Wheeling, Ill. Argon previously announced that it would close the Denmark facility and move production to Wheeling.
The company statement said the decision to move Gainesville's production to Athens, Texas, followed a study to determine "the optimal configuration of Argon's manufacturing operations to produce the highest quality product in the most efficient manner possible."
"While the results of our study were clear regarding the need to consolidate these facilities, this was not an easy decision to make," Argon CEO Michael Hudson said in the statement. "We understand the impact on our employees and stand committed to help them as they look for other employment."
Employees will be offered severance payments based on years of service, the company said.
"It's always disappointing when we lose a local employer and the jobs," said Susan Davenport, vice president of economic development for the Gainesville Area Chamber of Commerce.
Davenport said the priority is to try to retain Argon's talent for other employers in the area.
Although the WARN notice was filed Monday, FloridaWorks' Business Services Team had already reached out to Argon after hearing about the closure "through the grapevine," said Kim Tesch-Vaught, executive director of FloridaWorks.
The workforce agency is holding a job fair at Argon from Aug. 6-8. So far, five local manufacturing companies have signed up to recruit Argon's workers — RTI Surgical, Invivo, Prioria Robotics, Encell Technology and RGI Medical — Tesch-Vaught said.
The agency also will offer help with job searches, training funds and unemployment claims.
That five companies are already interested in talking to the employees speaks to economic development efforts to diversity the local economy, Tesch-Vaught said.
"There are more opportunities when something like this happens," she said.
The announcement follows the relocation of three other manufacturers over the past year. The Ball Corp. beverage can lid plant closed earlier this year, affecting 127 jobs. The company said the decision was the result of declining demand for standard 12-ounce cans and because its other lid plants have lower freight costs because they are closer to customers.
Heat Pipe Technology, with 35 employees, moved to Tampa to be closer to two interstates, an airport and ports, and a larger labor pool. Entertainment Metals, with 12 employees, was drawn to Fort Myers by incentives offered by Lee County when it was looking for a larger building.
Argon's relocation is typical of manufacturing companies buying other companies to increase market share or resources, said Brian Soucek, chairman of the Advanced Manufacturing Association of North Central Florida.
"They've got to move them where they need it," he said.
Soucek is human resources manager at SiVance LLC, which has withstood several acquisitions over the years to remain in Gainesville, most recently by Milliken & Company.