LITTLE ROCK, Ark. (AP) -- An India-based pipe manufacturer is no longer planning to open a $100 million plant along the Arkansas River in Little Rock, prompting the city to buy back the land for $2.2 million on Tuesday.
Man Industries Ltd. is no longer moving forward with its proposed plant, which officials last year said would bring more than 250 new jobs to the region, Arkansas Economic Development Commission spokesman Scott Hardin said.
"Right now, it's our understanding that Man is not proceeding with their U.S. manufacturing facility," Hardin said.
Little Rock Port Authority officials said the project fell through due to a lack of financing for the plant.
"The credit markets cratered about the time they started," said Paul Latture, executive director of the authority.
The company had announced the plant last year, which officials said would be able to produce 300,000 tons of pipes to be used primarily for the petroleum industry. The state had promised the firm $3.5 million in incentives, but no money had ever been handed over, Hardin said.
The Little Rock Board of Directors approved a proposal Tuesday night by the Little Rock Port Authority to buy the 155 acres intended for the plant for $2.2 million.
The state incentives offered to the plant came from Gov. Mike Beebe's "quick action closing fund," used to attract new businesses to the state. Beebe last year had said the starting salary for workers at the plant would be close to $12 an hour.
The firm also was offered $9.5 million in incentives through infrastructure improvements from Little Rock and Pulaski County.
Beebe spokesman Matt DeCample said the governor's office had heard about problems with starting the project for months, but did not get final word from the economic development commission until Tuesday. DeCample said the governor was disappointed that the plant was not moving forward.
Latture said the project had been put on hold months ago and the authority last month had approached the company about buying the property if the plant wasn't going to be built. The property will be bought with money from the port's barge and railroad operations, Latture said.
Latture said the authority hoped to be able to sell the property to another industry.
"The port is out of land," Latture said. "The thing that is attractive to us about the site is that it has rail access and it's an ideal site for heavy industry and that's what we're there to serve."
Another India-based company, Welspun Tubular LLC, plans a pipe plant at the Little Rock port. Welspun dedicated its $150 million facility in April.
Another new entry at the port is windmill blade maker LM Glasfiber, which laid off about 80 workers earlier this month. Glasfiber said the crisis in the credit markets and the recession have resulted in a prolonged slowdown of orders.