Imation to leave North Dakota plant by year's end

BISMARCK, N.D. - Imation Corp. plans to close its floppy diskette plant in Wahpeton by the end of the year, a few months sooner than expected, after a group of former employees have taken over some of its contracts.

Imation, based in Oakdale, Minn., announced one year ago that it would phase out the plant's near 390 jobs by mid-2009, as part of a company-wide restructuring.

"We have accelerated our plans to exit our operation," said Brad Allen, an Imation spokesman in Minnesota. Fewer than 10 Imation employees will be at the plant by Jan. 1, he said Thursday.

They will be working with a group of former employees who have taken over part of the business to try to save jobs.

In August, a group of employees at Imation formed ComDel Innovation Inc., which has been using the largest of Imation's three buildings. It acquired manufacturing assets to supply current customers under contract, said Jim Albrecht, the company's president and one of the former Imation employees.

Allen and Albrecht said the startup of ComDel allowed Imation to close earlier, since ComDel now has taken over some of the contracts.

"Imation has been very gracious and has done a good job supporting us," Albrecht said. "We currently have roughly a dozen clients, and Imation is our largest."

Imation currently has about 188 employees, said Jane Priebe, the city's economic development director. Most of the jobs will be phased out over the next few months, Priebe said.

Albrecht said ComDel has hired 80 former Imation employees, and plans to have 40 more Imation workers on the payroll by year's end.

Imation had been the second-largest employer in the southeastern North Dakota community of about 8,500. Officials said its plant, owned earlier by 3M, opened in Wahpeton three decades ago.

"There has been a 30-year legacy left by 3M and Imation," Albrecht said. "We're trying to preserve that as best we can — that's our mission — but our first objective is to make money to stay around."

Albrecht said most of the work being done for Imation involves making plastic and metal parts for electronic tape cartridges.

He said ComDel should have Imation contracts over the next several years, until the technology becomes obsolete, as was the case with floppy disks.

"As Imation products mature, we are going to have to bring in new products behind them to grow," Albrecht said.

ComDel is seeking new markets for precision machining, injection molding, metal stamping and tool making, Albrecht said.

Imation has received millions of dollars in local, state and federal grants and guaranteed loans to expand its Wahpeton plant.

Albrecht said no public money has gone into ComDel, though the company is seeking $400,000 in federal grants and loans to expand the business.

Priebe, the city's economic development director, said some former Imation employees have found jobs at a new ethanol plant in Hankinson.

"We've had some that have moved and found employment outside of the immediate region, and some are staying here but I don't know the net loss result," Priebe said. "We're doing everything we can to replace those good-paying Imation jobs."

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