Handleman Co. will fire about 100 workers in Glen Burnie and 50 in Atlanta as part of the distributor's move to consolidate those operations in Indianapolis.
The Troy, Mich.-based company said yesterday that the transfer to a state-of-the-art 400,000-square-foot distribution center in Indianapolis was part of a push to automate its distribution of books, videos, music and software to mass retailers such as Wal-Mart Stores Inc.
"It does everything we now do by hand," said Tom Oviatt, vice president and treasurer of Handleman.
The local distribution center is on McCormick Drive in Glen Burnie. The local sales office will not be affected, Oviatt said.
Distribution center workers will receive severance packages based on years of service, he said. Severance details were not available. The cuts are expected to be completed by the end of the summer.
For the fiscal year that ended last May, Handleman earned $5.4 million on sales of $1.18 billion. Profits have slumped the last several years. The company earned $43.7 million in 1993.
On Tuesday, Handleman's shares jumped about 11 percent to close at $11.5625 after Genesis Merchant Group Securities analyst Barry Sosnick rated the stock as a "buy" in new coverage, and said he sees the potential for the stock to rise 50 percent over the next year.
The company's shares closed yesterday at $11.
Handleman owns the licenses to the original "Halloween" and "Godzilla" movies and could get a boost when sequels to those movies are released, Sosnick told Bloomberg News.
Handleman's Oviatt said that "a lot of good things are happening for the company."
Joseph L. Harrosh, chairman of Tri-City Sporting Goods Inc., in February raised his personal stake in Handleman to 9.16 percent of the company's common stock. The company has said it considers Harrosh to be a friendly investor.
Pub Date: 5/08/98