A Med City manufacturer recently sold one of its divisions, which means 50 Rochester workers have a new employer and their former company can now close down a long-time local plant.
Crenlo Engineered Cabs sold Emcor Enclosures, which makes metal cabinets mostly for the computer industry, to California-based Jonathan Engineered Solutions. Jonathan Engineered, which is owned by private equity firm JLL Partners, makes precision ball-bearing slides, brackets, trays, and sheet metal assemblies that are complementary to Emcor’s enclosures.
In a memo to employees, Crenlo CEO John Lenga announced the deal happened on Oct. 5, though transition will continue into 2022.
“We will be supporting the Emcor team through a Transition Service Agreement through the end of June 2022,“ wrote Lenga. “The purpose of the TSA is to allow time for the buyer to establish its own process and systems.”
The manufacturer that primarily makes cabs for heavy industrial vehicles and tractors has a 70 year history in Rochester. Crenlo added Emcor, which represents the original name of Elgin Metal Formers Corp., to its operations in 1975
Crenlo, which employs 325 people, has Rochester facilities at 1600 Fourth Ave. NW and 2501 Valleyhigh Drive NW. Emcor recently moved into production space in the Rochester Technology Campus, formerly the IBM campus.
UAW Local 2125 represents Crenlo’s 325 employees. Local 2125 President and Emcor machine operator Troy Arnold said employee work contracts will remain mostly the same, despite the ownership change.
“The labor union will continue to be recognized under UAW Local 2125 by using an amalgamated union format. JES has agreed to all the terms of our current contract in content and duration, employees will retain all seniority rights wages and benefits,” wrote Arnold in a statement. “We look forward to working with JES and the growth opportunities that come with it.”
This is the latest adjustment by Crenlo. Its owners, California-based Angeles Equity Partners, had threatened to move the company out of Rochester unless it received financial support from the city and state.
The city, working with Rochester Economic Development Inc., provided Crenlo with a $300,000 forgivable loan from the city’s Economic Development Fund. The state's Minnesota Investment Fund city added a $450,000 forgivable loan to the package.
Rochester Public Utilities also agreed to provide $500,000 in utility rate incentives, bringing the value of the package offered to Crenlo to $1.25 million.
In return for the support, Crenlo has pledged to retain at least 336 jobs in Rochester for five years.
Some of the funds has been used to expand its plant at 2501 Valleyhigh Drive NW to accommodate a new paint line. However, Crenlo’s plan also includes closings its 1600 Fourth Ave. NW facility, probably by the end of the year.
Crenlo was founded in Rochester in 1951 by R.R. Cresswell, John Enblom and W.W. Lowther. The company's name is an amalgam of the first two letters of the last names of the three men who started it.
After decades of local ownership, it was sold to publicly owned Dover Diversified Inc. in 1999. In 2011, it was purchased by New York-based KPS Capital Partners. Angeles Equity purchased Crenlo from KPS.