LAPORTE, Ind. -- Allis-Chalmers Corp. Friday rejected an offer from an employee group to buy its LaPorte farm implement plant and said it will close the plant by the end of the year.
The second Employee Stock Ownership Plan offer, believed to include $2.5 million in cash, fell far short of the the company's request for $6.4 million up front.
'The company told the LaPorte OEM (Original Equipment Manufacturer) Inc. that after reviewing their Oct. 25 offer to purchase the plant, the company elected not to accept the proposal and subsequently to end negotiations,' said Roy W. Uelner, president of the Allis-Chalmers Agricultural Equipment Co.
'The key consideration in the negotiations was the company's stated position that it would not provide financing for either fixed assets or working capital,' said Uelner. 'The final offer from LaPorte OEM did not meet these conditions.'
LaPorte OEM Inc. is the company ESOP set up to take over the plant if its offer was accepted.
Allis-Chalmers announced last fall that it would close the LaPorte plant if it could not find a buyer by late 1983. The company agreed to give employees the first chance at buying the facility.
Last month, ESOP made an offer of $1 million down and $4 million to $8 million financed, which Allis-Chalmers rejected.
Jerry Moll, president of the LaPorte Chamber of Commerce and chairman of ESOP task force, said everyone involved now will begin looking for a buyer for the plant, which covers 80 acres.
'We feel that every possible angle has been approached to make this thing happen,' said Moll. 'We will immediately turn our attention to assist where we can to market that plant to generate new business.'
Approximately 350 people were affected by Allis-Chalmers' decision, although less than 100 were working at the plant Friday.
