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American Fuel Cell and Coated Fabrics Co. will close its plant in Magnolia, putting about 300 people out of work and ending a relationship with the Columbia County city that began at the end of World War II.

The Magnoliareporter.com website first reported the news Monday night.

"We have done everything possible to try to keep the company here," Mayor Parnell Vann said Tuesday. "Now, a lot of economic development people always say that, but I really mean it. It saddens me because many generations have given their lives to that company. I personally have seen two generations do it."

Known in the community as Amfuel, the company makes fuel cells for the aerospace industry. The plant's annual payroll is about $6 million.

"What really gets me close to crying is that it's not going away because of a lack of business," Vann said. "I'd rather have no wars, but as long as we have wars, fuel cells are important. I want it to be known across the state, across America, that we have a skilled workforce right here in Magnolia, so maybe a competitor will come in here."

Vann also said he hoped that a lot of the displaced workers can find jobs on an $85 million project to widen U.S. 82 across Arkansas' southern third.

Vann said most Amfuel workers are from Magnolia, though others are from surrounding counties and even from Louisiana parishes. "It will hurt us locally for a while, but we're going to work together on this," Vann said.

Mike McNeill, publisher and editor of Magnoliareporter.com, cited a memo that the company's chairman and interim president and chief executive officer, Britt Gourley, sent to United Steelworkers Local 607L, seeking the cancellation of a collective-bargaining agreement that runs through Nov. 22.

Gourley wasn't available Tuesday for comment.

Jeremy Brummett, director of plant operations, issued this statement through a secretary: "We are still in negotiations with the union and we will be glad to have a statement when negotiations are completed at the end of next week."

The secretary said union representatives normally could be reached through the plant's primary telephone number but that they were not available for comment Tuesday.

In an email to Magnoliareporter.com, Gourley said the company was disappointed at being unable to keep the plant open but was thankful for the efforts of the city and state. "Unfortunately, and as they are informed, our collective efforts to remain in Magnolia failed but it was not for lack of trying," he wrote.

The company opened a plant in Wichita Falls, Texas, earlier this year. Gourley's memo to the union stated that a "number" of the Magnolia employees would be offered jobs at the Texas plant. Specifics on those numbers and on the company's final workday weren't available Tuesday.

"Factors beyond any of our control including lack of productivity, escalating costs associated with irreparably deteriorating infrastructure, and our financial ability to continue to sustain significant losses at our Magnolia facility, seem to us to demand this result," Gourley continued in his memo to the union.

"Accordingly, it is our intention to limit our bargaining discussion to the reasons behind our desire to cease operations at the plant, the potential time frame for closing the plant, and development of an orderly procedure for moving work from the plant that will minimize the effects of a closure on your members," Gourley wrote.

The company said on its website that it began operations in 1917 when Firestone Tire and Rubber Co. started supplying fuel cells for the nation's aviation needs. The company moved from California to Arkansas at the end of World War II and converted the former Magnolia Cotton Mill into a manufacturing plant of coated fabrics and fuel cells. It changed its name to American Fuel Cell in 1983 when local investors bought it to keep it from closing.

It was sold in 1995 to a French company, Zodiac Aerospace, and was sold again, in 2015, to Crosslake Investment Group.

The Arkansas Economic Development Commission said Tuesday that it had been made aware of company's intention to close the Magnolia plant. The plant didn't receive any development commission incentives over the years, except for some employee assessment and training in 2011 and 2012, the commission said.

Business on 09/21/2016

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  • Foghorn
    September 21, 2016 at 9:42 a.m.

    The Magnolia workers have known since January 2015 the plan was to close the plant. A sale by then owners to the new private equity owners gave them a little reprieve. They appear to have squandered multiple opportunities to reach a compromise to keep the plant open and keep their jobs. Typical union intractability resulting in lost jobs. Private equity is never going to negotiate with unions. Their singular objective is return on their investment.

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