Less than two years after Gloucester Engineering, the oldest non-marine industrial business on Cape Ann, was saved from bankruptcy by private equity acquisition, the firm that figured out how to make plastic bags celebrated its 50th anniversary with a state loan to service domestic and export back orders.
With a growing workforce of more than 100 employees, including some veterans from the early days, the Golden Anniversary celebration — bagels and cream cheese, doughnuts and coffee and tea — climaxed with a symbolic transfer of a $1 million line of credit from the Massachusetts Growth Capital Corp. So life was good Friday at the first company in Blackburn Industrial Park.
"I am humbled," Gloucester Engineering Chief Executive Officer Mark D. Steele said more than once, referring to the employees sitting in the lunchroom of the plant facing a cast of local and Boston government and political leaders, including state Sen. Bruce Tarr, who has worked closely with the company for many years, Rep. Ann-Margaret Ferrante and Mayor Carolyn Kirk.
"Many employees have been here 30 years," said Steele, who represents the revitalization chapter of the story, since Blue Wolf Capital invested in a company that once was and now is again a global leader in plastic extrusion and converting. The company uses software to make the capital machines that generate food wrapping and plastics for agricultural products and shrink wrapping to precise specifications.
"It's my good fortune to be the steward," Steele added.
As recently as late 2010, Gloucester Engineering was floundering after being cast off by a German conglomerate and passing through ownership that lacked the resources during the global economic decline.
Employment that had topped 400 when humans rather than computer software did the drafting back in the 1960s and '70s was still near that level in 2006 when the business and the economy figuratively went south.
Blue Wolf Capital, a New York-based private equity firm, came to the rescue. It kept Carl Johnson as president, but put in more than $26 million to get the company out of bankruptcy in December 2010.
Charles Grigsby, president of Massachusetts Growth Capital Corp., offered a bow to private investment, saying he represented "public money supporting, not leading private investment."
Grigsby, whose agency was created in 2010 by the Legislature "to promote economic development in underserved, gateway municipalities and low and moderate income communities," such as Gloucester, illuminated three reasons for celebrating — "determination" by Blue Wolf Capital, "the future of manufacturing" and "public-private cooperation."
Grigsby said the state administration was attracted by Gloucester Engineering's backlog of orders, its proven record, its strong management team and equity source.
The $1 million loan will be used to assist the company in securing letters of credit to purchase materials needed to make the machines that companies need to make plastic packaging, foam, film and rigid sheet plastic products like clamshell packaging.
It all started in a garage on Sargent Street, when Gloucester Engineering's founder, the late G. Wilbur Tracey, figured out how to make plastic bags.
Soon thereafter, Gloucester Engineering expanded into related product-making machines. Along with Varian Semiconductor Equipment Associates — which followed Tracey's company into Blackburn Industrial Park — and with Bomco, the metal fabricator, the company helped Gloucester diversify its fishing-based economy just as the industry was entering a lengthy decline driven by environmental and conservation concerns, and foreign competition.
All three companies are capital heavy precision engineering based contractors. Bomco differs in that it makes the parts themselves while Gloucester Engineering and Varian produce the machines that make parts; Varian produces machines that are essential in chip-making.
"Gloucester Engineering has 'refocused,'" said Tarr, long a champion of the firm, "and in its 50th year is again alive with innovation, market leadership and good jobs for people throughout the region."
"The Massachusetts Growth Capital Corp. has delivered an important tool for Gloucester Engineering to continue its vital role in the city as thought-leader in industry and job creator for residents," said Mayor Kirk.
"There ought to be a big sign at the start of Blackburn Industrial Park — home of the comeback kid," Ferrante added.
Richard Gaines can be reached at 978-238-7000, x3464, or at firstname.lastname@example.org.