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Kelly Moore Paint announced Friday that it will immediately cease operations and close due to the insurmountable costs of asbestos-related litigation.
The sudden closure marks the end of a 78-year history for the company, which was founded in San Carlos, San Mateo County. Kelly Moore moved its headquarters to Texas last year in an effort to rebuild its business, and now operates 157 stores across the United States. Five stores will close in San Francisco.
“We are extremely disappointed and saddened by this outcome,” said CEO Charles Gassenheimer. “From day one, the ownership group has been committed to rebuilding the business if possible. No matter how great Kelly Moore’s team, products, and reputation were, they were unable to overcome the tremendous legal and financial burden that had weighed on the company over the years when it came to service.”
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The company announced the furloughs of 700 employees earlier this week, according to a press release.
Pluget Chemicals said it was unable to overcome “unexpectedly significant challenges” after acquiring the struggling California paint maker in October 2022, including more than $170 million in estimated future asbestos debt. Ta.
Kelly Moore used asbestos in some of its products under prior ownership prior to 1981. The company has paid out $600 million over 20 years to settle claims, but said the constant litigation has severely limited its ability to reinvest in the business.
The company said it pursued all options to find new financing and partnerships, but was unable to garner interest due to the asbestos litigation. Management said the decision to close was “the only viable alternative.”
Kelly Moore said it will continue to fulfill existing customer orders to the best of its ability, but will immediately close all manufacturing and retail locations except for its distribution facility in California.
Kelly-Moore Paints locations in San Francisco:
- 565 S. Van Ness Ave.
- 1020 Harrison Street
- 364 Divisadero Street
- 701 Bayshore Boulevard
- 445 Taraval Street
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