Acquisition keeps good jobs in Cleveland
by Karen Kahn
The Fund for Employee Ownership (TFEO), an initiative of Evergreen Cooperatives in Cleveland, recently announced its fourth acquisition: Intellitronix. The 35-person manufacturing firm makes microprocessor-controlled LED gauges for cars, boats, and recreational vehicles.
TFEO purchased the assets of the wholly owned subsidiary from US Lighting Group, which sought to spin off Intellitronix in order to develop and grow its other companies. US Lighting will have additional capital to focus on new business opportunities and fuel growth.
“This transaction represents the first manufacturing company conversion for the fund,” said Jeanette Webster, chief investment officer.
With the addition of Intellitronix, the Evergreen Cooperative network will employ about 350 workers.
The Fund for Employee Ownership launched at the end of 2018 and has raised $11 million from philanthropic and social impact investors to transition businesses in northeast Ohio to employee ownership. The fund finances the transitions, and Evergreen uses its expertise in cooperative business to train staff and develop an ownership culture to ensure a successful transition.
Intellitronix will become part of the Evergreen Cooperative network, which also includes Evergreen Cooperative Laundry, Green City Growers, Evergreen Energy Solutions, BI Cooperative, and Phoenix Coffee Co. With the addition of Intellitronix, the cooperatives will employ about 350 workers. The network helps support the businesses by sharing learnings and providing some back-office services.
As a small manufacturer, Intellitronix was attractive to Evergreen Cooperatives. Its high-paying jobs—$15 to $20 per hour—and steady profits guarantee that employee-owners will be able to build wealth relatively quickly, says John McMicken, CEO of Evergreen Cooperatives. The firm has been growing at about 10 percent a year and expects to continue that growth.
Says McMicken, “US Lighting Group was looking to cash out in order to finance and grow its other businesses.” Noting that the firm could have been bought by a competitor who might have shut it down or consolidated it with other businesses, McMicken says, “our purchase secures these quality manufacturing jobs for Cleveland area workers.”
Karen Kahn is a communications consultant and the editor of Employee Ownership News.