What had been the GE silicone plant in Waterford was bought by the hedge fund Apollo Global Management. Its president, Leon Black, made celebrity status when he paid $120,000,000.00 for the Edvard Munch painting, “The Scream.”
The purchase of the plant from GE was a classic Wall Street maneuver. The hedge fund paid $3,800,000,000.00 by leveraging debt and leaving the newly created company with huge debt. If this story goes the way many of these do, Black’s hedge fund will have received millions of dollars in fees for their new creation no matter what happens to it. If the plant fails, Apollo will walk away with its fees leaving Momentive unable to pay its creditors.
That debt led Momentive to file for a bankruptcy that, according to Forbes Magazine, was eventually worth $300 million to the company. “Apollo has been the hottest private equity player in recent years,” the magazine said in an admiring profile. It’s possible they received fees for managing the bankruptcy of their own company.
The employees of Momentive endured a wage cut in 2010 and a pension freeze for 400 of its members in 2013. In November IUE CWA Local 81359 rejected the latest contract which included more draconian cuts to employees’ benefits for health, vacation, and retirement.
For some reason, Americans seem often to lack empathy for people on strike. In this case, the men and women of this local have been out for forty-two days. Given the stress of lost income for such a long period life is very hard.
On Tuesday night in bitter cold weather there was a rally and march to support the strikers. It was there I ran into our Assemblywoman, Carrie Woerner. I think it speaks extremely well of her, especially given how conservative this district is, that she would turn out for the event.
The Times Union home page has a large banner in which Momentive solicits new employees. I never recall any similar solicitation on their home page. It is particularly of note that they are asking for “replacement” positions. It is interesting because it doesn’t include anything about the type of work. Momentive is a chemical plant. Working with chemicals requires great care due to the hazardous nature of the process. Replacing employees with the skills to perform the work is not easy. I have been told that the non-union employees that have been hired (referred to as scabs by the world of unions) have been mainly for maintenance purposes and little in the way of production has been happening. I speculate that this “advertising” has more to do with unnerving the people on strike than it does to actually finding employees.