STERLING – HALO Branded Solutions of Sterling is acquiring Newton Manufacturing Co. of Newton, Iowa, which last week declared Chapter 11 bankruptcy.

HALO has signed a definitive agreement to buy the business assets of Newton Manufacturing, according to a news release issued by HALO.

Newton Manufacturing began bankruptcy proceedings Friday in federal court, and that filing was completed Monday.

Although formerly a manufacturer, Newton Manufacturing is now a specialty advertising company that’s been employee-owned since 1988.

“We have explored several options to resolve the difficult financial environment we have operated under for several months,” Newton Manufacturing President Mancil Laidig said in a news release. “It became clear that our greatest assets – the Newton sales force and the loyal team that supports them – would be best served with a Chapter 11 filing.”

Both companies said they would work to retain as many Newton employees as possible. The Iowa company has 59 workers at the Newton facility who support a nationwide network of hundreds of independent contractors.

Newton is located in central Iowa, about 30 miles east of Des Moines.

“Our goal is to retain value in Newton’s business during this transition in order to provide a great home for their loyal sales force, opportunities at HALO for many of their experienced support staff, and as much payment on pre-filing liabilities as possible to our valued suppliers,” HALO CEO Marc Simon said.

HALO Branded Solutions has been in the promotional products distribution business for more than 60 years. Based at 1980 Industrial Drive in Sterling, the company has more than 900 account executives throughout the U.S. and a support staff of more than 300.

Newton Manufacturing, which was founded in 1909 by George Newton, hasn’t made new products since a fire destroyed manufacturing facilities in 1943. The “Manufacturing” part of the name was left intact for brand recognition.

Simon said his company had reviewed Newton Manufacturing’s finances for quite some time. HALO attorneys filed a motion to speed up the transfer of assets within 30 days.

“We felt we could provide a meaningful value for their business that would allow them to apply much of the proceeds to pre-filing liabilities,” Simon said.

The agreement also calls for HALO to provide financing for Newton’s orders shipped and billed during the transition period.

– Sauk Valley Media reporter Pam Eggemeier contributed to this story.