It’s not often a billion-dollar public company decides to move its corporate headquarters to the Philadelphia area.
Particularly not one from the manufacturing sector.
That’s what’s happening with Gardner Denver Inc., which intends to relocate its headquarters from Quincy, Ill., where it was founded 151 years ago.
There’s much we don’t know about this move. For example, the company wasn’t specific about where in the “greater Philadelphia” area it was locating. Given that the Philadelphia Mayor’s Office was not listed among the organizations involved in luring Gardner Denver, it’s safe to assume the suburbs won out once again.
But with about 53 jobs involved in this relocation, we’re not taking about an economic development coup on the order of attracting the North American headquarters of Shire P.L.C., the British drug company that now employs 982 in Chester County.
Gardner Denver chief executive officer Barry L. Pennypacker said in a statement that the board of directors had concluded that relocating to a major metropolitan area was “necessary to the long-term growth of the company.” The company, which generated 68 percent of its $1.78 billion in 2009 revenues from outside the United States, needs to improve accessibility to its global customers and foreign operations, he said.
Amazingly, Philadelphia came out on top of a “relocation analysis” done with the help of an unidentified “external consultant.” Who was this mysterious sage? The Phillie Phanatic? Bill Cosby? M. Night Shyamalan?
After all, unless I have my geography wrong, Quincy, located on the banks of the Mississippi River, is about 200 miles southwest of Chicago, which seems to have pretty good international air service.
Tom Morr, president and chief executive officer of Select Greater Philadelphia, will take a win any day he can. His organization markets the region as a good place to do business and was involved with the Pennsylvania Governor’s Action Team, the state Department of Community and Economic Development and the Team Pennsylvania Foundation in attracting Gardner Denver.
Morr said that his organization hosted four visits to the region by Gardner Denver representatives and consultants who were seeking information about the area’s labor force, quality of life, cultural amenities and international air service.
Generally, if Select Greater Philadelphia can get a prospect to tour the region, about 20 to 25 percent of the time that company decides to relocate here, Morr said.
It probably also didn’t hurt Philadelphia’s chances that Pennypacker, 49, got his M.B.A. in operations research from St. Joseph’s University or his bachelor’s degree in operations management from Penn State. But he spent much of his career near Pittsburgh where he was an executive with Wabtec Corp. before becoming president and CEO of Gardner Denver in January 2008.
Still, Gardner Denver makes machinery such as air compressors, pumps and blowers, which would seem to make it an anomaly here in the life-sciences heavy Philadelphia region, right?
Not so, according to Morr. He categorized what Gardner Denver does as “advanced manufacturing,” and that’s in great evidence in the Philadelphia area. Think of the Global Positioning System satellites being made by Lockheed Martin Corp. in Newtown, Bucks County, and the helicopters being assembled by Boeing Co. in Ridley Township, Sikorsky Aircraft in Coatesville, and AgustaWestland in Philadelphia.
“It’s a strength of this region,” Morr said.
After reviewing Gardner Denver’s string of 22 acquisitions since 1994, I’m reminded of other industrial products firms, such as Ametek Inc., based in Paoli, and Triumph Group Inc., of Wayne. Both have grown into multi-billion-dollar enterprises by buying lots of companies. Gardner Denver now employs more than 6,000 in 40 factories and other operations worldwide.
As usual, there were state incentives to seal this deal. Luke Webber, a spokesman for the Department of Community and Economic Development, said that the state offered a package totaling $504,000. It breaks down like this:
* $265,000 in an Opportunity Grant, which is tied to the creation of 53 jobs within 3 years of operation.
* $159,000 in job creation tax credits.
* $80,000 in job training assistance.
Webber said the total capital investment in the project is $1.5 million.
What about Quincy, Ill., where the company was founded in 1859 by Robert W. Gardner who’d redesigned something called the “fly-ball governor” used in steam engines? After the headquarters move is done, Gardner Denver still expects to employ 365 people in the factories and corporate back-office functions that will remain there.
Share prices rarely move one way or another on news of the relocation of a corporate headquarters. So I’ll simply note that Gardner Denver shares closed Thursday at $52.15, up 14 cents or 0.3 percent.