Biddeford Textile workers get ultimatum

PORTLAND – The partnership that has offered to buy bankrupt Biddeford Textile Corp. said Wednesday the deal could collapse if workers do not drop some of their claims on the group.

The struggling blanket maker’s employees are seeking some $1.4 million in back pay and benefits from the group.

A lawyer for Microlife Corp., the Taiwanese company that heads the purchasing group, told a federal bankruptcy judge in Portland on Wednesday that the group’s costs are mounting.

Robert Michael warned that unless a deal with workers can be struck by Friday, the partnership will seek to liquidate its debts by filing for Chapter 7 bankruptcy.

Michael said that, barring an agreement, Microlife will file a motion Friday asking the court to order that the company’s assets be sold off at an auction.

Then the partnership, known as Biddeford Acquisitions or Biddeford Blankets, would bid on the assets, he said. At that point the company would not be obligated to pay off the workers’ back wages and benefit claims.

In order to force the auction, Microlife would ask the court to convert the bankruptcy case to a Chapter 7 case.

The company is now trying to reorganize under Chapter 11 of the U.S. bankruptcy code.

Before filing the motion, Microlife plans to negotiate with the Union of Needletrades Industrial and Textile Employees in the hope of gaining concessions.

The union’s lawyer said Microlife may have a tough sell in negotiations, pointing out that employees have previously given up pay and benefits in return for stock that is now worthless.

“I think there’s only so much blood you can get out of a stone, and the workers have given and given and sacrificed for years,” said Jonathan Beal.

Beal did leave open the door for negotiations, though, acknowledging his concern that the partnership will be able to free itself of financial obligations to employees.

Last February, Biddeford Textile laid off 350 workers, most of its work force, and a month later filed for bankruptcy protection.

The company later resumed its operations and is now operating with about 250 workers.

The partnership offered last month to pay $5.8 million to buy the blanket maker’s assets and keep the company operating in Biddeford.

When Microlife first became interested in buying Biddeford Textile, it expected to be responsible for about $300,000 in claims, Michael said.

But that number keeps growing, he said.

One reason is that the union is now demanding that workers receive $200,000 in cash to make up for stock they did not receive the last two years.

“We can’t afford to keep writing checks every day and every month,” Michael told Judge James B. Haines Jr. “It has become too expensive.”