Stainless-steel veterans buy Springfield equipment fabricator

Geary Gorrell, son Ryan and Tim Stallion – doing business as G2 Material Handling Inc. – bought SSI for an undisclosed amount in a deal that closed in May. Gary Rogers of Kingsley Group Business Brokers brokered the transaction.

In 1999, SSI President Russ Lombard and then-partner Donnie Tyson formed the stainless steel fabricator company. SSI co-founder Lombard now sits on G2’s board of directors.

Geary Gorrell, president and CEO of Springfield-based G2, said the pairing of the two companies made sense on several levels, not the least of which was optimizing SSI’s rarely used production shop at 4439 W. Billings St., just east of the Interstate 44-Chestnut Expressway interchange. Lombard still owns the property, which he leases to G2.

SSI has focused heavily on its sanitary piping business, which Gorrell said takes place mainly in the field. SSI primarily serves food and dairy operations in the four-state region.

“We’re hoping to expand that,” Gorrell said of SSI’s service area. “They’ve been kind of in the same customer rut for a long time. And they have no marketing, so that’s the reason we were excited about getting a hold of them.”

Under that business model, Gorrell said, SSI morphed into a second-hand maintenance department for many clients, leaving its 20,000-square-foot shop underutilized.

Gorrell said G2 executives saw an opportunity to expand SSI’s work force and clientele by acquiring the company and stepping up production. G2 plans to nearly double the number of employees by hiring 10 to 12 welders, grinders and polishers in the coming months.

Gorrell said three employees already are hired and another couple of candidates are in the pipeline. Finding people with the right skills has been relatively painless, he added, pointing to Paul Mueller Co.’s recent layoff of 134 employees, about 10 percent of its local work force.

“Springfield’s … kind of stainless steel heaven,” Gorrell said. “We really don’t have to do much recruiting. It’s really pretty much word-of-mouth.”

SSI, which will retain its name, began with about a half-dozen customers and today serves between 25 and 50 clients, including Dairy Farmers of America, International Dehydrated Foods and Schreiber Foods, Lombard said. Coincidentally, G2 – a company that specializes in immediate bulk container systems for dry products – learned of SSI while pricing its material handling systems, he added.

G2 officials later contacted Rogers at The Kingsley Group about the prospect of acquiring a local fabricator, and SSI emerged as the logical choice. Prior to that, The Kingsley Group had been confidentially marketing SSI for about a year, Rogers said.

G2’s plan to ramp up production for pharmaceutical clients – a group that includes McNeil Consumer Products and Bayer HealthCare, both of Pennsylvania – is reflected in the increased activity at SSI’s shop.

“Right now, it’s humming out there,” Gorrell said. “SSI’s business is picking up. It looks like they’re going to have a banner year.”

Stainless-steel companies that serve the pharmaceutical industry have historically benefited amid economic downturns, Gorrell said, noting that G2 is 15 percent ahead of its 2008 revenue projection.

“Usually, when economic times are real bad, we’re real good because they don’t want to invest their money – they’d just as soon buy the equipment,” he said.

Gorrell previously worked for Stainless Fabrication Inc. and Tote Systems International in Texas. G2’s Vice President and Chief Operating Officer Ryan Gorrell, whose background is in engineering, also spent five years with Tote Systems after a 10-year stint with NASCAR.

Gorrell said he and Stallion worked together at Plymouth IBC Services, which was later acquired by Hoover Materials Handling Group. Stallion, who is G2’s chief financial officer, previously worked for Springfield-based Custom Metalcraft. [[In-content Ad]]