Robert Wahler is regaining control of the Santa Ana pollution-control systems company that he founded nearly three decades ago.
Wahler and current managers are acquiring the assets of Wahlco Inc. from a Tennessee firm undergoing bankruptcy reorganization. Their winning bid of $1.8 million was approved this week in U.S. Bankruptcy Court in Santa Ana.
The deal, which is expected to close by Jan. 5, will boost Wahlco's prospects by allowing it to escape from the shadow of Thermatrix Inc.'s financial difficulties, said James Clark, Wahlco executive vice president.
"Some companies won't even consider doing business with you if you're bankrupt," he said.
Wahlco should post profits of $2 million this year on sales of $13 million, Clark said. The company has 55 employees, and operations are expected to be unaffected by the ownership change.
Thermatrix, a pollution-control company in Knoxville, bought Wahlco and 25 affiliated companies in January 1999 for about $3.8 million in cash. Thermatrix also assumed the units' debts, including a $5.7-million loan. At the time of the acquisition, Wahlco was struggling under the twin pressures of increased industry competition and the Asian economic crisis.
Thermatrix filed for bankruptcy reorganization last December after being unable to pay back the entire loan.
"Things didn't work out like we expected them to," Thermatrix Chief Executive Dan Tedone said, adding that the company expects to emerge from bankruptcy by early next year.
In related news, Thermatrix expects to sell Wahlco Engineered Products Inc. of Lewiston, Maine, for more than $1.4 million later this month. Wahlco Engineered, which makes industrial equipment used in power plants, was acquired by Thermatrix as part of the Wahlco deal.