Iowa Foundry To Stay Open

In a late 11th-hour turn of events, the 85-year-old Katelman Foundry will remain open, and all employees are back to work.

Tony Bailey, general manager for Katelman Steel Fabrications, Inc., said the company was to close its doors permanently June 1, when new owners Steve Skold and Tony Hovenga came in and bought the company.

"We were in the process of shutting the doors, when they came in and bought the business," Bailey said.

Bailey said the paperwork to purchase the company was signed by Skold and Hovenga May 26^th.

Already, the new owners have invested more than $100,000 into necessities such as software equipment, Bailey said.

Hovenga said general conversation with Katelman officials began the first week of February, but didn't start becoming serious talks until March 1.

Hovenga and Skold spent the entire month of March gathering information on the company. On April 14, an agreement was reached for the duo to purchase the company.

Katelman was bought, Hovenga said, because the two had been interested in purchasing the company for some time, and look to expand into other areas of the construction industry.

Skold and Hovenga have a background in the construction business, as they own Skold Construction Services, Inc., and Skold Door Company, Inc., with offices in Des Moines and Sioux Falls, S.D.

The Katelman Foundry has provided structural steel to construction projects across Iowa and Nebraska. The company's operations will continue at its current Council Bluffs facility, and all work in progress will be completed by the new company.

"We are glad the opportunity has come to work with the 30-plus employees at Katelman, and to keep these jobs in the local area," Skold said in the release.

Katelman filed a Chapter 11 bankruptcy Oct. 8, 2003, after the company lost almost $500,000 because of an upswing in material costs.

That loss, Bailey said, was a result of China buying up mass quantities of scrap metal, which sent material costs from 20 cents a pound to 42 cents a pound.

"That's basically what caused all our losses that year," Bailey said. "When that happened, it put a lot of companies out of business."

Katelman is watching material cost prices much closer, Bailey said, and is able to handle another major shift in material costs. Daily Nonpareil