Category: KB

US Senate News:

Source: United States Senator for Pennsylvania Bob Casey
Private equity owners seek to shut down Pyrex plant that has been a keystone of Charleroi, PA for 132 years
In recent years, Wall Street has gutted companies and communities in a seemingly never-ending quest to make a quick buck off the backs of hardworking Americans
In light of new report, Casey is pressing FTC to pursue measures to stop the plant closure pending a full investigation into private equity firm Centre Lane Partners’ potential illegal activity to acquire plant without regulatory approval
Read Casey’s report: Charleroi, PA: An Example of How Private Equity is Shattering the Glass Industry and Leaving Workers Behind HERE
Washington, D.C. – Today, U.S. Senator Bob Casey (D-PA), member of the Senate Finance Committee, released a report exposing how a private equity firm is shattering Charleroi’s 132-year-old proud tradition of glass manufacturing. Closing the Charleroi Pyrex glassware factory would not only cost more than 300 Pennsylvanians their jobs but would change the fabric of this community and put an end to one of Pennsylvania’s most impressive manufacturing success stories. His report, Charleroi, PA: An Example of How Private Equity is Shattering the Glass Industry and Leaving Workers Behind, exposed private equity firm Centre Lane Partners for questionable financial engineering and shady business deals that culminated in Centre Lane’s recent decision to close the plant, leaving its workers as collateral damage. In the report and a follow up letter to FTC Chair Lina Khan, Casey called on the Federal Trade Commission (FTC) and Department of Justice (DOJ) to take action to block the plant closure pending the outcome of a full investigation into the private equity firm for its efforts to evade regulatory rules to strip the plant bare and lay off Pennsylvania workers.
“Private equity crushing Charleroi’s generational legacy of glass manufacturing is yet another example of Wall Street screwing over Pennsylvania workers. The plant’s closure is a slap in the face to workers, their community, and the people of Pennsylvania,” said Senator Casey. “I am working every day to protect union jobs and hold Wall Street executives accountable for the havoc they’ve wreaked in our Commonwealth.”
Since Anchor Hocking abruptly announced plans to close this glass manufacturing plant in September 2024, Senator Casey has been investigating the questionable practices used by Anchor Hocking’s private equity owner, Centre Lane Partners, to make a quick buck. In his report, Casey revealed how private equity firms like Centre Lane prioritized short term ownership of companies to maximize profits at the expense of companies’ long-term health. Specifically, the report showed how Centre Lane purchased two of the Nation’s largest home glassware brands, Pyrex and Anchor Hocking, even though it initially failed to receive regulatory approval to purchase Pyrex in the fall of 2023. Casey’s report exposed Centre Lane’s actions to obtain a potential monopoly in the home glassware manufacturing market and emphasized the urgent need for a federal investigation. The report also laid out a timeline detailing Centre Lane Partners’ questionable financial engineering and shady business deals that culminated in the decision to consolidate its home glassware manufacturing at a separate Anchor Hocking facility outside of Pennsylvania.
The initial findings outlined in Senator Casey’s report only raised more alarms about Centre Lane’s potential illegal activity. In a letter to FTC Chair Lina Khan, Casey laid out the perplexing and questionable practices of Centre Lane and its acquisition of several glassware companies and called for a swift and full investigation. Casey urged the FTC to block the closure of the plant while it investigates whether Centre Lane violated the law in its acquisition of the facility.  
Casey’s report and call for investigation continue his tireless efforts to combat the Charleroi plant’s closure and save Pennsylvania jobs from the ravages of private equity. Immediately upon learning of Anchor Hocking’s plans to close the plant on September 5th, Senator Casey’s office reached out to the plant’s union leadership and Charleroi Borough officials, connecting them with federal and state authorities. Casey’s office also helped convene a task force of county commissioners, borough officials, and local economic development leaders. Casey’s staff also alerted the White House Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization to the situation, leading to several federal officials visiting Charleroi on September 11th. On September 19th, Senator Casey sent a letter to Anchor Hocking demanding an explanation for the closure and imploring the company to reconsider its actions. On September 20th, Senator Casey and Senate Finance Committee Chair Senator Ron Wyden successfully requested a joint confidential briefing with the Federal Trade Commission (FTC) on questions concerning Anchor Hocking’s assumption of control of the Pyrex manufacturing operation in Charleroi.
Read the full report “Charleroi: An Example of How Private Equity is Shattering the Glass Industry and Leaving Workers Behind” HERE.
Read the full letter to FTC Chair Lina Khan HERE or below:
Dear Chair Khan:
I write today regarding the recent decision to shut down the Pyrex glass factory in Charleroi, Pennsylvania by its private equity owners, Centre Lane Partners, and parent company, Anchor Hocking. As I have detailed in a recent report entitled, Charleroi, PA: An Example of How Private Equity is Shattering the Glass Industry and Leaving Workers Behind, Charleroi has become the latest victim of the all-too-common abusive financial engineering that private equity owners engage in to make a quick profit at the expense of its workers and consumers.  In light of the numerous concerns that I raise in that report and this letter, I believe that Center Lane Partners’ acquisition of the Charleroi Pyrex plant deserves the fullest scrutiny by federal enforcement agencies, and I urge you to take whatever action necessary—including filing for preliminary injunctive relief—to block this plant closure pending the completion of an investigation into the matter.
As you know, many private equity (PE) firms invest in companies and use financial engineering tactics to extract a quick profit from the company at the expense of its long-term health, its workers, and its customers. Unfortunately, few industries and companies exemplify the abusive PE playbook as much as the glass manufacturing industry and Anchor Hocking. Over the past 28 years, four major domestic glass manufacturers have filed for bankruptcy eight times among them—one bankruptcy every 3.5 years. In five of those cases, the company was owned by a PE firm —a fact that is not surprising given that PE-owned companies are far more likely to go bankrupt than non-PE-owned companies. 
From dividend recaps and leasebacks to layoffs and cutting employee benefits, including retirees’ healthcare, PE firms have specifically abused Anchor Hocking and its workers for far too long.  However, over the course of my preliminary investigation into the recent circumstances surrounding Anchor Hocking and the Charleroi Pyrex plant, I am particularly troubled by the manner in which the PE firm, Centre Lane Partners (“Centre Lane”), came to acquire the Charleroi Pyrex plant. This acquisition set the stage for the subsequent announced closure of the plant, as well as the hundreds of lost jobs associated with the closure.
In June 2023, the Charleroi plant’s prior parent company, Instant Brands (“Instant”), filed for bankruptcy. Instant was owned by another PE-firm, Cornell Capital, and included the popular Instant Pot and other consumers brands including Corelle, Pyrex, Snapware, CorningWare, Visions and Chicago Cutlery.  After a bankruptcy auction in September, Centre Lane received court approval to acquire Instant’s housewares and appliances businesses in two separate transactions for $228.2 million and $122.6 million, respectively.  Based on the Hart-Scott-Rodino (HSR) Act, I understand that these acquisitions would have both been subject to FTC premerger review given that they were higher than the HSR filing threshold in 2023—$111.4 million.
In November 2023, Centre Lane officially acquired Instant’s appliance division, but bankruptcy documents filed in December confirmed that Centre Lane failed to receive the required regulatory approvals to finalize the deal for Instant’s housewares division.  As a result, Instant proposed a new plan wherein Instant would emerge from bankruptcy under the ownership of its prior lenders. In February 2024, Instant’s restructuring plan was approved and the housewares division emerged from bankruptcy under the new name, Corelle Brands (“Corelle”), and under the ownership of its prior lenders, including Centre Lane, which held 33.6% of the company.
Less than a week and a half later, Centre Lane purchased the remaining 66.4% of Corelle from the majority lenders, including another PE firm, Citadel Group (“Citadel”), for approximately $38.5 million.  The Anchor Hocking CEO informed me that this decision was made after “[t]he majority owners of Corelle, who had no operating or industrial expertise in the glass manufacturing industry broadly speaking, approached Centre Lane . . . about buying their ownership interests, as it became clear that Corelle Brands on a stand-alone basis would likely not be economically viable.”  Days later, Centre Lane transferred ownership of Corelle to a subsidiary of Anchor Hocking in exchange for common stock valued at approximately $79.8 million.  Approximately six months later, in September 2024, Anchor Hocking announced that it would be shutting down the Charleroi Pyrex plant.
Given this timeline, it is fair to question why a PE firm—seemingly as sophisticated and savvy as Citadel—decided to acquire a company coming out of bankruptcy only to determine less than a week and a half later that it was no longer a viable investment. But it is even more perplexing that Centre Lane was able to acquire two-thirds of Corelle for merely $38.5 million in March 2024 and transfer it to Anchor Hocking days later at yet another price ($79.8 million)—all while evading FTC oversight—after it previously bid nearly $230 million for the same company and filed for regulatory approval in September 2023.
The timeline of these financial transactions raises enough questions on its own, but the subsequent decisions of Centre Lane also justify further scrutiny. I have been informed by locals in Charleroi that despite taking ownership over Corelle, Anchor Hocking does not actually control two of Corelle’s most valuable brands—Pyrex and Snapware. It is my understanding that the licenses for these brands are in the process of being transferred or have already been transferred to another Centre Lane affiliate, 1880 Hospitality. This assertion is further supported by Anchor Hocking’s letterhead, which includes all of Corelle’s previous brands, except for Pyrex and Snapware.  It is difficult to discern a logical business reason for such a move, but even more peculiar—it further calls into question the financial details of these transactions. How did Centre Lane acquire two-thirds of Corelle, including Pyrex and Snapware, for just $38.5 million from its prior owners, and then days later, transferred it to Anchor Hocking for approximately $79.8 million without two of its biggest brands—Pyrex and Snapware?
At the core of these questions and concerns is whether Centre Lane engaged in any illegal activity to evade FTC scrutiny in pursuit of an anticompetitive advantage in the kitchenware and glassware markets. To better understand these concerns, it is important to review Centre Lane’s recent acquisition history. As you know, “rollups” are a common PE tactic to acquire many smaller companies in a specific market to be able to better exert market power and extract economic rents in a market. For example, since at least 2018, Centre Lane has made a concerted effort to acquire numerous kitchenware and tableware brands, and its portfolio now includes Anchor Hocking, Corelle, Pyrex, Corningware, Snapware, Chicago Cutlery, Visions, Lenox, Oneida, Kate Spade New York tabletop collection, Hampton Forge, Reed & Barton, and Cambridge.  Centre Lane’s increasing market share in the kitchenware industry raise some broader antitrust questions, but none more so than the glassware market. 
In the domestic market, “heavy” glassware products—such as bakeware, measuring cups, and food storage containers—are primarily sold under two brands—Anchor Hocking and Pyrex. A simple search on just a few retail websites is illustrative. On Target’s website, 11 of the 12 glass bakeware products sold in-store are Pyrex, and in Wal-Mart, 33 of the 45 glass bakeware products sold in-store are either Pyrex or Anchor Hocking.  On Costco’s website, a search for “glass food containers” returns nine results—five of which include Anchor Hocking or Pyrex.  When searching for “glass measuring cups” sold on Amazon.com, 11 of the first 20 products are Pyrex or Anchor Hocking.  Permitting Centre Lane to control both Anchor Hocking and Pyrex clearly increases its ability to manipulate the glassware market at the expense of both consumers and workers.
During your time as Chair of the Federal Trade Commission, your focus on the impact of PE in our markets has been laudable. As you highlighted in remarks on March 5 regarding the impact of PE in healthcare, some PE firms can provide an important source of capital for companies and aim to “take a more long-term view and focus on creating real operational improvements to generate value in ways that provide broader benefits.”  Too many, however, “take a different approach, where they load up companies with enormous amounts of debt, strip valuable assets and sell them off to enrich the private equity owners, and pursue financial engineering tactics that leave the underlying firm weaker and worse off.”  Given the history of PE abuses at Anchor Hocking and its recent decisions at the Charleroi Pyrex plant,  I am afraid that Centre Lane falls into the latter category.
In light of my preliminary investigation and the information that I have shared in this letter, I respectfully request your response to the following questions. Additionally, recognizing the strict confidentiality requirements under the Hart-Scott-Rodino Act, I ask that you answer these questions to the best of your ability as a general statement of law and agency practice, and not related to any particular individual case or company:
In your experience, is it common for a company to be valued at nearly $230 million in a bankruptcy auction, but then be bought for only a third of that price months later?
If a company is initially denied regulatory approval to acquire another company by the FTC, is it legal for the company to proceed with the acquisition under different terms without notifying the FTC?
What tools does the FTC have to address anticompetitive deals that are consummated—either legally or illegally—without FTC premerger review?
How much market share would a combined firm need to control for the FTC to consider a merger or acquisition to be anticompetitive?
Is it lawful for a company to establish monopoly power over a market, if the company divides the market among its various subsidiaries? 
Do antitrust laws and/or FTC guidelines and practices allow a company to divide a potential acquisition’s assets among multiple subsidiaries in order to evade FTC oversight, including HSR premerger review?
Do antitrust laws and/or FTC guidelines and practices allow a company to evade FTC oversight, including HSR premerger review, by acquiring a company in two steps? For example, by buying only 33% of a company initially, and then later buying the remainder?
What tools (e.g., statutory authorities, resources) does the FTC need to better address the potentially anticompetitive behaviors of PE firms?
Over the course of my preliminary investigation into this matter, I have unfortunately been left with far more questions than answers regarding Centre Lanes’ transactions, its decision to close the Charleroi Pyrex plant, and its broader impact on competition in the glassware market. At the very least, these questions deserve the fullest scrutiny from federal enforcement agencies, but unfortunately—time is of the essence. On Thursday, October 10, Centre Lane, through Anchor Hocking, submitted its federally required Worker Adjustment and Retraining Notification (WARN) notice confirming its plans to begin laying off workers in Charleroi on December 9, 2024, and fully shutting down the plant by February 28, 2025. 
Recognizing the time sensitive nature of this situation and to ensure a full and fair investigation into the many issues that I have raised in this letter, I urge you to consider filing for preliminary injunctive relief against Centre Lane’s acquisition of Corelle and utilizing any other tools at your disposal to block its efforts to shut down the Charleroi Pyrex plant. Knowing the resources and time necessary to pursue court action, I do not make this request lightly, but it is worth noting that there is historical precedent for the FTC to intervene in mergers regarding domestic glass manufacturing companies. In 2002, Libbey abandoned efforts to acquire Anchor Hocking due, in part, to an order issued by the FTC, and over a decade later in 2015, executives again dismissed the possibility of a merger between the two companies given the FTC’s prior concerns. 
After years of shady business deals and financial engineering, we owe it not only to the workers of Charleroi, but to the thousands of workers across the Nation who have been repeatedly taken advantage of by Wall Street and PE firms, to ensure that we are taking every action possible to fully investigate and hold accountable any company that has engaged in wrongdoing in this situation. Wall Street should not, and cannot, act with impunity.
Thank you for your leadership on this issue and for your and your staff’s cooperation with Senator Wyden’s and my inquires on this topic to date. I look forward to your prompt response.

MIL OSI USA News –