In an unexpected conclusion to its decades-long presence in the paint industry, Kelly-Moore Paints has announced it is immediately ceasing operations and will begin an orderly shutdown. According to a statement obtained by Business Wire, the Bay Area paint giant, once a beacon to contractors and do-it-yourself enthusiasts, has been forced to close its doors permanently after saddling with insurmountable financial and legal challenges.
The company stated that the shutting down process will see attempts to fulfill outstanding customer orders through existing inventory at their Union City distribution center, but all other facilities, including the manufacturing plant in Hurst, Texas, and retail stores will be shutting down effective immediately. Having struggled under the weight of asbestos litigation claims dating back decades, the company has experienced a crippling financial blow, as reported by SFGate. Although asbestos was phased out of their products by 1981, lawsuits continued to pile up, leading to an untenable future for the company.
“I'm extremely disappointed and saddened by this outcome, as the entire Kelly-Moore team made incredible efforts to continue innovating and serving the unique needs of professional painting contractors,” CEO Charles Gassenheimer said in a statement. The leadership’s efforts to turn the distressed business around, including planned tech upgrades and resolving some of the pending asbestos claims, proved fruitless in the face of the financial challenges.
A significant part of the company’s downfall came from legal debts inherited following their acquisition by Pleuger Chemicals in 2022. The looming cost of “ever-continuing case filings” had already drained $600 million from Kelly-Moore's coffers and was expected to exceed $170 million more in the future, Gassenheimer disclosed to Business Wire. With no new investors stepping up and additional funding out of reach, Kelly-Moore's attempt at restructuring or finding a buyer has come to naught.
The closure marks the end of an era for Kelly-Moore, a company that stood as one of America’s largest independent paint producers. Starting in 1946 in San Carlos, founders William E. Moore and William Kelly, with Moore's wife Desiree Moore, grew the business into a prominent name in the industry. This final chapter, brought on by years of asbestos litigation and financial woes, will impact 700 employees laid off and multiple communities where the company previously did business, shared a heavy-hearted Gassenheimer.
