SHERBROOKE, Que.(AP) — Quebec furniture maker Shermag will be closing its chair assembly plant in Lennoxville, Que. for an indefinite period of time, transferring the work to a nearby plant in Granby, Que. instead.
The union representing 45 steelworkers in Lennoxville say they learned of the closure on Tuesday.
The plant will be used as a warehouse space and for now the machines will not be sold and there is no intention of moving them, a union spokesman said.
At best, four or five employees will continue to work in shipping, the union says.
The other workers will be laid off in about eight weeks.
The union says the company cites a substantial drop in the order book that necessitates the closure of the plant.
Just a few years ago the factory had over 200 employees, a union spokesman said.
The Quebec-based company reported earlier this month that its losses nearly tripled to $22.3 million in the third-quarter thanks to lost revenues and restructuring costs.
The ongoing U.S. housing crisis has hurt Shermag, which is weighing a going-private proposal.
On the Toronto stock market Tuesday, Shermag shares lost 1.5 cents to close at 44.5 cents.