Spokane Journal of Business

Accra-Fab execs buy out Valley fabricator’s stock

Company has outgrown Liberty Lake plant, hopes to nearly double its size

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Accra-Fab Inc., a Liberty Lake-based precision sheet metal fabricator with 300 employees here, has been bought by its president and a company director, dismantling an employee stock ownership plan (ESOP) that had owned most of the company for the past eight years.

Accra-Fab President Don Hemmer and board member Greg Konkol bought all shares of stock in the company earlier this month, giving each of them half interest in the company. The two executives bought the 78 percent share that had been owned by the ESOP for $8 million, and most of the remaining shares for an undisclosed price from Accra-Fab founder Bob Griffith and the companys vice president for manufacturing, Chuck Cates. Hemmer already owned a minority share.

The ESOP, formed in 1991, had paid $4.6 million for much of Griffiths interest in Accra-Fab and some newly issued stock. Earlier this yeartwo years ahead of schedulethe ESOP paid off the bank loans it had taken out to finance the 1991 buyout. The ESOP owned 78 percent of the company when Hemmer and Konkol bought it out.

Meanwhile, 19-year-old Accra-Fab has outgrown the 80,000-square-foot production facility at Liberty Lake that it moved into in 1997, and now is planning to nearly double the size of that plant, Hemmer says. The company is negotiating with its landlord and hopes next year to have its plant, located at 1611 N. Molter Road, expanded by about 70,000 square feet of space, he says.

To ease overcrowding there in the meantime, Accra-Fab has leased about 14,000 square feet of space in a nearby building at 22808 E. Appleway. The company plans to relinquish that space once its main building is expanded.

The planned 70,000-square-foot expansion would be used initially for assembly work and storage, but later for additional machining space and to accommodate additional employee growth.

Accra-Fab expects by next spring to add about 25 workers to the 300 it currently employs at Liberty Lake. The company also employs another 70 people in a plant it operates in Vancouver, Wash.

Accra-Fabs board decided to start looking for a buyer for the company earlier this year, once it realized that the ESOP wasnt going to be able to ensure long-term financial strength for the company.

Basically, an ESOP just drains the cash right out of a company, Hemmer contends.

Hemmer and Konkol and a competing New York investment company stepped forward to buy Accra-Fab. Hemmer says he and Konkol had to outbid the investment firm to keep the business locally owned.

As a result of the sale, Accra-Fabs employees will receive a portion of the proceeds through an employ pension plan.

Hemmer will retain his position as company president, and former shareholder Cates will remain as vice president of manufacturing. Konkol, who helps run Konkolville Lumber Co., of Orofino, Idaho, has been named executive vice president of finance at Accra-Fab, but is expected to have limited daily involvement with the company here.

Accra-Fab makes specialty metal parts for electronic and biomedical companies.

Accra-Fab projects its sales will grow in 1999 to $25 million. The company had sales of $21 million in 1998.

  • Lisa Harrell

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