Forty people will lose their jobs in the wake of the sale of Bulova Technologies LLC and the closing of its downtown Lancaster plant, the company president said Wednesday.
Stephen L. Gurba, president and chief executive officer of the company, which manufactures electronic products for commercial and defense contractors, said the sale should be completed by Monday.
Gurba said a company formerly known as 3Si Holdings Inc. agreed Dec. 3 to purchase Bulova for an undisclosed amount. He said the deal does not include the 212,000-square-foot Bulova building at Queen and Orange streets.
On Nov. 21, 3Si Holdings Inc. changed its name to Bulova Technologies Group Inc. The new Bulova company will send Lancaster's operations to Melbourne, Fla., one of three Bulova divisions in Florida that are included in the deal, Gurba said.
Gurba, who bought Bulova in 1995, said 10 salaried employees will remain with the new company and move to Florida. Forty others, however, will lose their jobs.
Gurba said he's been trying for a year to sell the company, which he said has struggled to be profitable. Eighty percent of the proceeds from the sale would be used to pay off debts to a Manhattan bank, he said.
"It's not what I want to do," Gurba said. "Banks are collecting money; they're not lending it these days."
Gurba said the Lancaster plant will cease operations before the end of January.
Bulova had as many as 120 employees in Lancaster as recently as 2006. Things looked good for Bulova when Gurba bought Dictaphone Corp.'s Electronic Manufacturing Systems division in Melbourne, Fla., for an undisclosed price, a move that more than doubled Bulova's sales.
In 2006, Gurba said he hoped to increase the work force at the downtown building to about 220.
Two years ago, the Melbourne plant, with 340 employees, posted annual sales of $60 million, while Bulova's Lancaster operation had annual sales of $40 million.
It has operated as both a defense contractor and systems contract manufacturer since 1962. Bulova once was affiliated with Loews Corp. and was once part of Bulova Watch Co., founded in 1875.
Watch companies were sought out by the U.S. Defense Department after World War II to make military fuzes.
In 1989, BulovaTech acquired Hamilton Technologies, which was founded by the Hamilton Watch Co. in 1890.
"It's painful. The company has been in Lancaster County for almost 120 years and has been in the city for 40 years," Gurba said. "But I had no choice but to sell the business.'
Gurba said he will remain in Lancaster as a landlord after he remodels the four-story, windowless building in Lancaster Square.
He plans to add windows and open retail shops and a restaurant on the first floor.
"I hope to add Class A office space on the top three floors for folks who want space near the revamped section of the city just down the street from the new convention center," Gurba said.
Representatives of Commerce Bank/Harrisburg, said last week that it still plans to build a $5 million office in Bulova building. Those plans were announced in January 2007.
E-mail: pburns@lnpnews.com