McNaughton-McKay Electric Co., Madison Heights, Mich., one of the largest automation specialists in the United States, will now be 100 percent employee-owned.
Previously, the company was partially employee-owned. The transfer has been smooth and there are no related organizational changes or job losses, the company said. Donald D. Slominski Jr., president and CFO; John R. (Jack) McNaughton III, executive vice president and COO; and Richard M Dahlstrom, corporate vice president, sales and marketing, all remain in their current leadership roles.
The company first looked at the possibility of an ownership transfer in late 2005 when the shareholders expressed the desire for a liquidity event. McNaughton-McKay Electric Co. has been privately owned for 97 years. Several options were considered, but with the company having an Employee Stock Ownership Plan (ESOP) that already owned 30 percent of the outstanding shares, it became apparent that it was in the best interest of all parties that the remaining shares, primarily owned by the Bull and McNaughton families, be purchased by the ESOP.
Jack McNaughton said, “It was important to us that the tradition we had developed not be lost in the process,” which was another reason McNaughton-McKay Electric Co. chose the ESOP option. “Who better to lead the new company forward than the people who made McNaughton-McKay Electric Co. the leader that it is today.”
The goal was to have a seamless transfer of ownership without any impact on the customer. To that end Slominski said, “The transaction has been enthusiastically supported by the vendor community.” The transaction was completed on December 22, 2006, making McNaughton-McKay Electric Co. one of the largest privately held ESOP companies in the United States. The company also ranks 36th on Crain’s Detroit largest private 200 list.
With approximately 800 employees and 22 locations, McNaughton-McKay Electric ranks as the industry’s 13th largest electrical distributor, according to Electrical Wholesaling’s 2006 Top 200 listing.