June 28--SHELTON -- Even as the Latex Foam factory burned Thursday, a newspaper notice was running advising readers of a planned auction of the company's property and assets.
The public notice was published in the classified section of Thursday's Connecticut Post. The ad appeared on the day fire swept through machinery and duct work at the company's 510 River Road headquarters, shutting down production and casting about 200 people out of work.
The notice was placed by Lawrence Berger, managing director of investments at Blackstreet Capital Management in Chevy Chase, Md.
Blackstreet is described as a private equity firm specializing in investing in controlled buyouts of underperforming companies on the East Coast.
"The property will be offered for sale as an entirety," the ad states. "A deposit of $250,000 will be required at the time of the sale. .. with the highest bidder required to pay the balance in cash, by way of bank wire.
Attempts to reach Berger and James Berman, a Bridgeport lawyer who represents Latex in U.S. Bankruptcy Court, about the ad and why it was placed were unsuccessful Friday.
Fire probe continues
Fire Marshal James Tortora, who was inside the building Friday as part of the ongoing cleanup and investigation, confirmed earlier reports that the blaze started in a mattress drying-oven that spread to the conveyor and entered duct work. The fire, combined with the 150,000 gallons of water used to extinguish it, caused extensive damage in the basement.
"We still haven't determined the cause," Tortora said. "The power was restored to some of the building and the sprinkler system is being repaired."
Tortora said there does not appear to be any major structural damage to the building.
U.S. Sen. Richard Blumenthal, D-Conn., said he expects to tour the site sometime next week.
He said his office is ready to examine every source "of possible aid to the employees who are truly the innocents, regardless of the cause of the fire. They deserve any help that is available."
Blumenthal said the published reports on the "history of the site, along with questions raised about the financial status of the company, may arise curiosity on the part of authorities."
The fire is just another in a series of events that have cast concern on the future of the company, which arose from the ashes of the March 1, 1975 Sponge Rubber Products arson that devastated the Naugatuck Valley's economy for years.
There's the 2001 fire that destroyed its Ansonia facility, leading to the move to Shelton. There's the 2012 conviction of two executives who are serving federal prison terms for embezzling $3.5 million and there's the May 30 filing in U.S. Bankruptcy Court seeking protection from $29 million in debts.
And there's the legal notice maintaining that under numerous amended and restated loan and security agreements, Latex Masters Inc. shall conduct a public sale of all assets of Latex Foam International.
While the auction is to take place at 10 a.m., the actual date is left blank.
Shelton OSHA violations
In a related matter, Latex Foam signed an agreement Monday with the U.S. Department of Labor's Occupational Safety and Health Administration office in Bridgeport to pay $4,000 in fines for violations at its 12 Commerce Drive site in Shelton.
OSHA inspectors cited the company for the following violations at that site:
Failure to conduct a workplace hazard assessment to determine the necessary and appropriate types of personal protective equipment for employees performing various tasks, such as spray finishing;
Failure to require employees to wear protective equipment, provide training and information pertaining to workplace hazard assessment;
Failure to maintain a written hazardous communication program at the work site for employees handling chemicals and listing the hazardous chemicals;
Failure to keep electrical equipment free from recognized hazards that could cause injury or death;
Failure to install a proper railing on a second floor loading bay, which could lead to an 11-foot fall.
"Unfortunately, the company does not appear to be eligible for federal aid in this situation," said U.S. Rep. Jim Himes, D-Conn. "My offices stand ready to assist any of my constituents who may need help with unemployment insurance as a result of this terrible incident."
Edmund Fitzgerald, an OSHA spokesman, said Latex agreed to pay the first $1,000 installment Oct. 1.
He also said the River Road facility that burned Thursday was cited for three violations in 2005 resulting in $1,237 in penalties.
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