Eichleay Holdings Inc., a 127-year-old company and a longtime fixture in Pittsburgh's Point Breeze neighborhood, will begin winding down operations under the guidance of a court-appointed receiver.
However, there is hope the company's business may continue in some form, if the receiver, the Pittsburgh-based Meridian Group, can find a buyer for all or part of its assets.
Eichleay, which got its start as a home moving company in 1875 and eventually evolved into a mainly engineering-services and general-contracting firm, currently employs abut 200 people, most in the Pittsburgh area.
Meredian, a Pittsburgh-based investment banking and financial services firm, is beginning an effort to find a buyer for all or part of the company and seek placement for as many of the workers as possible, Meridian's president Margaret M. Good said Thursday.
"We'll be moving as quickly as possible," said Good, who said she already has had discussions with about "a half-dozen" potential buyers, although no actual negotiations are under way at this time. "We are encouraged we've had such a strong response."
The decision to put Eichleay Holdings and three subsidiaries into receivership was made by mutual consent of the company officials and Citizens Bank of Pennsylvania, the prime lender to Eichleay, according to J. Kent May, legal counsel for Meridian. Citizens in late 2001 acquired the retail banking operations of Pittsburgh-based Mellon Financial Corp.
According to court documents, Citizens made secured loans to Eichleay that have a current outstanding balance of about $5.3 million. The documents also say the company had informed the bank that, due to current financial conditions, it intended to go out of business.
"This is an effort to stabilize the company's situation, protect its customers, provide an opportunity for the employees … and to help assure the bank will not lose any more money," said May, an attorney with the Pittsburgh law firm of Eckert Seamans Cherin & Mellott LLC.
A motion to appoint Meridian as receiver was approved by Judge Ronald Folino at a hearing Wednesday in Common Pleas Court in Pittsburgh, May said.
According to a news release, George F. Eichleay, who has stepped down as Eichleay's chairman, attributes the companies' problem "to a reduced level of capital expenditures in the companies' core businesses and the bankruptcy of eight major customers over the last 18 months."
Eichleay, who is a great-grandson of company founder John Eichleay Jr., could not be reached for comment yesterday. But according to Good, the company's major clients include companies in the steel industry, which has been particularly hard hit by bankruptcies over the last several years. Other contracts include those with firms in the chemicals industry and with government agencies, she said.
May said the company has not ordered any mass layoffs at this time, but has told staff that the company will not accept any more work.
Existing projects will be continued, however, and it is likely those working on those jobs will be laid off as they are completed.
Eichleay's headquarters building at 9585 Penn Ave. is not part of the company's assets. It leases its space there from a partnership that owns the building, May said.
According to court documents, companies involved in the bankruptcy include Eichleay Holdings, Eichleay Corp., Eichleay Engineers & Contractors Inc. and Eichleay Engineers Inc.
As detailed on the company's Web site, Eichleay's early years as a mover of homes and other large buildings included a number of noteworthy projects, such as the relocation of the mansion of Capt. Samuel Brown (in the Squirrel Hill section of Pittsburgh) in 1903. The home was "raised 160 feet up a sheer cliff, when 500 feet back from the cliff's edge…," and it was "intact" when the move was completed, the company history relates.
After the moving business faded, the company entered the equipment-installation business in the 1930s, and in later years entered into general contracting for mechanical installations. With acquisition of the Peter F. Loftus Co. in the early 1980s, Eichleay expanded into design/construct services.
