Kaydon to shut plant as expiry of energy tax credit looms
Oct 4 (Reuters) - Kaydon Corp, a maker of specialty ball bearings for wind turbines, said it would shut a South Carolina plant and record a charge of $47 million to $52 million due to the impending expiration of a renewable energy tax credit and weak markets.
The renewable energy production tax credit, which expires at the end of this year, provides a tax credit of 2.2 cents per kilowatt-hour of electricity produced.
President Barack Obama wants the credit renewed but Republican presidential candidate Mitt Romney supports letting it expire.
"(While) wind energy will be a viable market in the long term, it will be challenged by continued regulatory uncertainty in the United States, including the impending expiration of the Production Tax Credit and a weak global economy," Chief Executive James O'Leary said in a statement.
The wind industry has warned that 37,000 jobs would be lost if the tax credit is allowed to expire.
Kaydon, which reported a lower second-quarter profit, will record the charge in its third quarter.
The company will shut one of its three plants in Sumter, South Carolina, previously devoted to the wind energy and military ground vehicle markets.
Shares of the company, which has a market value of $726 million, closed at $22.68 on the New York Stock Exchange on Thursday.