ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, August 15, 1996 TAG: 9608150040
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: MEGAN SCHNABEL STAFF WRITER
Four months after it suspended operations amid mounting financial problems, Roanoke bottled water producer Quibell Corp. has resumed production under new ownership.
Operations at the Quibell plant in Roanoke's Centre for Industry and Technology began a few weeks ago, said Scott Frayser, one of four partners in Matrix Capital Markets Group Inc. Frayser said Wednesday that the plant has completed a full production cycle and its products soon should reappear on store shelves.
Matrix, a Richmond investment banking group, bought the privately owned Quibell in June, after the Roanoke company filed for Chapter 11 bankruptcy, which gave the company protection from creditors during reorganization.
The new owners have brought back 20 former Quibell employees full time and another five to 10 people on a temporary, as-needed basis, said Frayser, who is acting president of Quibell.
The first signs that Quibell was having financial problems emerged in April, when its Pennsylvania bottle supplier, Zuckerman-Honickman Inc., refused to send any more of Quibell's distinctive curved bottles, claiming the Roanoke company owed $600,000 in unpaid invoices.
In its bankruptcy petition, Quibell listed liabilities of $3.7 million, including $900,000 owed to NationsBank Corp. and $22,000 to Corrugated Container Corp. of Roanoke County.
Filing for protection under Chapter 11 has allowed Quibell to continue operating while negotiating new terms with creditors and restructuring debts. Matrix is trying to develop relationships with Quibell's suppliers, Frayser said, many of whom are unsecured creditors and will be addressed in Quibell's reorganization plan. The plan should be filed by October.
"Our intent is to evaluate how the business is going forward and treat them as fairly as possible," Frayser said. Matrix has settled Quibell's dispute with Zuckerman, he said.
For the next year, Quibell will concentrate on its core products, which accounted for the bulk of the company's sales: flavored sparkling water, non-sparkling water and teas. Gone for now will be the company's cola and other flavored sodas. Quibell may bring them back eventually, Frayser said.
"We need to assess where the market is in general, and we haven't done that yet," he said.
Distributors and retailers, some of whom were left without Quibell products for several months, are returning to the fold slowly.
"They are cautious," Frayser said. "Once they understand that the old management is gone, they're much more open." None of the former Quibell managers has been retained by Matrix, he said.
Industry experts told The Washington Post it will be difficult for Quibell to regain its market share after so long a hiatus, especially in the highly competitive bottled water business where new brands are always vying for attention.
But Frayser was optimistic.
"As the product stands, it's got an enormous amount of support out there," he said. "It's going to be a slow road back, but we're encouraged."
The Associated Press contributed information to this story.
LENGTH: Medium: 62 linesby CNB