MIAMI — Off a gritty bend in the Miami River, a few miles from a warehouse where he recently touted his job-creation plans, there's a complex of buildings that bear witness to a time when Mitt Romney's private equity firm laid off hundreds of workers, shuttered a profitable factory and made out with hundreds of millions of dollars.
It started in 1995, when Romney's Bain Capital targeted the company that became Dade Behring, which made blood-testing machines and performed animal research at its Miami campus.
Bain borrowed heavily to buy the company and closed a factory in Puerto Rico to improve the bottom line. About 400 lost jobs there. Then in 1997, Bain shuttered Dade Behring's Miami operations, costing another 850 jobs and a $30 million payroll in the community.
Before growing debt consumed the company, Bain executed its exit strategy and made $242 million.
"What bothers me most is that Romney's campaign says he was a creator of jobs," said Cindy Hewitt, a Miami resident who was a human resources manager at Dade Behring. "I didn't see that in any way, shape or form. He didn't create jobs. He slashed and burned jobs."
Romney's time at Bain is the backbone of his run for president, the business experience he says is severely lacking in President Barack Obama. He portrays himself as a turnaround specialist, taking poor-performing companies and making them efficient and profitable. He claims to have created 100,000 jobs.
But the Miami experience illustrates the other side of Romney's line of work, a messier reality that has exposed Romney to attacks from rivals seeking the Republican nomination.
Even comedian Stephen Colbert has gotten in the act, running a South Carolina ad that shows a cartoon Romney feeding Dade Behring into a wood-chipper that spits out money.
Next week, the GOP campaign shifts to Florida and already Romney is on the defensive with a TV ad that touts his Bain successes while condemning attacks on the "free market." GOP rival Newt Gingrich says Romney "looted" companies like Dade Behring.
"The Bain model," Gingrich said in a debate Monday night, "is to go in at a very low price, borrow an immense amount of money, pay Bain an immense amount of money and leave. I'll let you decide if that's really good capitalism. I think that's exploitation."
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Romney helped found Bain Capital in 1984 as a spinoff of Bain & Company of Boston. In 1994, Bain borrowed heavily to invest in the buyout of medical companies that would become Dade International, which had roots in Florida.
In 1997, Bain acquired two other companies and formed Dade Behring, which was based in Deerfield, Ill. The company flourished, raking in millions in sales.
Yet debt was soaring. Under Bain's direction the company squeezed costs through plant consolidations, layoffs and reduced employee benefits. In November 1997, Dade Behring announced it would close two Miami facilities, which employed 850 people, and consolidate operations in Delaware and Germany.
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Romney's campaign did not directly address Dade Behring for this story, saying "Bain Capital invested in many businesses; while not every business was successful, the firm had an overall track record and created jobs with well-known companies like Staples, Dominos, and Sports Authority."
Debate on the campaign trail has cast light on the lucrative private equity business. Firms like Bain typically heavily leverage acquisitions, look for efficiencies then sell the property for a windfall.
Dade Behring was a textbook case for Bain, a clear example of the "golden eggs" Romney once said would be hard to give up when he left to run the 2002 Olympic Games in Salt Lake City.
A prospectus for Bain noted that from 1984 to 1999 its "five private equity funds achieved an average annualized rate of return of approximately 178 percent per annum on all realized investments, and 88 percent per annum on all investments."
Bain borrowed most of the money to acquire Dade and rewarded itself with $100 million in fees for buying and running the company, according to the New York Times. The $242 million payday for Bain came in 1999, when Dade Behring was forced to buy out half its shares, the newspaper reported.
To make the payment Dade had to borrow more, contributing to its shaky status. The deal came a few months after Romney left Bain, though he still had a stake.
"I hear Mr. Romney talk about creating jobs, what he really did was create wealth for investors," said Michael Rumbin, a former Dade vice president in Illinois who had to fire 25 to 35 people before his own job was eliminated. "No one ever came to me and said, 'How do we create more jobs?' "
Saddled with $1.5 billion in debt and facing higher interest rates, Dade Behring entered Chapter 11 bankruptcy in 2002.
Creditors accused Bain and other investors, which included Goldman Sachs, of "unjust enrichment," according to SEC filings. That was not proven, though Bain surrendered the rest of its stake. Dade Behring emerged from bankruptcy and in 2007 was purchased by Siemens for $7 billion.
A success story or not? That is the debate Romney's tenure at Bain has stirred.
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Romney has acknowledged some of the ill consequences of his enterprise but maintains focus on his success at Bain in trying to draw contrasts with Obama.
"He never had a job. I think to create jobs it helps to have had a job," Romney said in November at the Conchita food factory in Miami, a backdrop chosen to affirm his jobs mind-set. Indeed, it later was used in a Spanish language TV ad in Florida.
In some cases, attacks on Bain have fallen flat. A Panhandle company was featured in a 28-minute video purchased by a pro-Gingrich political committee calling attention to Bain. But the layoffs at that plant occurred after Bain sold the company.
"We felt very used," said Mike Baxley, a former employee at the washing machine business who said the videomaker never mentioned Bain and portrayed it as a film on plant closings. Baxley said his story was uplifting because he helped form his own company, Washers-R-Us.
"I wasn't a Romney fan to start with, but I've been watching the debates and everything since and starting to get a better feel for him than I am the other ones," said Baxley, 41.
"They are trying to use his record as something that's negative and ... it's really been a positive for many, many, many companies out there."
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U.S. Rep. Mario Diaz-Balart, R-Miami, who appears in Romney's TV ad, said he did not recall what happened in his hometown years ago. Indeed, the jobs were lost during a strong economy and did not get a lot of media attention. Even now, with the plant in the news there is not an outpouring of outraged former workers.
"It's horrible when anybody loses their job," Diaz-Balart said. "But the reality is that's a company that created thousands and thousands and thousands of jobs. Here's the question: How many jobs has Obama created?"
But for some it still burns.
Hewitt, the former HR director in Miami, said she found the company particularly heartless in the way it handled about a dozen highly skilled workers from Puerto Rico, whom Dade Behring wanted to transfer to Miami after their plant was closed.
She said they fretted about Miami closing as well and that she relayed the concerns to managers, who pointed out the Miami plant was the most-profitable operation in the country and that there was "absolutely no plan to close it."
Two months later, Bain announced it would close the Miami operation. The workers wanted to return to Puerto Rico. And they wanted the company to waive a relocation-repayment penalty if they left Dade-Behring.
"No," she said company managers said. "Absolutely not."
Hewitt, a Democrat who plans to vote for Obama, said she wanted to speak out about what happened. "It was horrifying to me that I had played any role."
The experience, she said, eventually led her to get out of human resources. She is now an animal-welfare advocate.
Hewitt said she doesn't know what happened to the hundreds of people who lost their jobs.
Neither does handyman José Gutiérrez, who worked for Dade Behring and stayed at the facility when it was converted to its present use as a self-storage warehouse.
"I worked with these people, they were friends, but I never saw them again," said Gutiérrez, 53. "I think no one came back because they were sad."
Gutiérrez recalled one former worker, a Colombian immigrant like him, who fretted that he couldn't find a job to match the $12-an-hour salary he earned at the warehouse. He also remembered the African-American security guard.
"I'm making $22 an hour," Gutiérrez recalls the man saying. "Now all I can find is minimum wage."
Alex Leary can be reached at firstname.lastname@example.org. Marc Caputo can be reached at email@example.com.