Ownership changes at FEC

Listen to this article

Harry Blok joined FEC Technologies in March 2007 as a minority shareholder. Two years later, Blok has purchased majority control of the York County firm.

Blok worked as chief financial officer for Zero Restriction Inc. — a York County-based outerwear company. He began the process of acquiring FEC last fall, partnering with Springettsbury Township-based Hammer Creek Enterprises to help with financing. Blok, who now is the company’s president, declined to share the terms of the deal.

FEC Technologies provides engineering-design, metal-fabrication, control-panel-manufacturing and system-integration services. The firm employs 35 people at its 32,000-square-foot facility in Manchester Township. The company brings in about $7 million each year in sales, Blok said.

Susquehanna Bank employees recommended a partnership with Hammer Creek Enterprises to facilitate the financial end of acquisition, as well as help pay off some debt, Blok said. Hammer Creek’s two employees now are minority shareholders of FEC and are members of the firm’s board of directors, he said.

FEC was founded in 1953 as Frank Electric Corp. The LePage family acquired ownership of the firm in the 1980s and changed the name about five years ago to better reflect the company’s offerings, Blok said.

Two years ago, Blok became a minor shareholder when he bought out Fred LePage’s share of the firm. This year, with the help of Hammer Creek, he bought out majority owner Darren LePage, the son of Fred LePage, and minority shareholder John MacKinder. Blok said his transition to majority owner was part of the LePage family’s succession plan. Darren LePage declined to comment for the article.

Blok said his relationship with the firm began in the late 1990s when he brought in FEC Technologies as a supplier for Springettsbury Township-based Graham Engineering Corp., where Blok worked as a materials manager.

FEC Technologies services a number of industries, but one in particular that Blok said he would like to concentrate on pursuing more is the wind-power industry.

“I see fantastic opportunities in the alternative energy market, such as wind power and biofuels,” Blok said. “We want to grow organically, but if the right opportunities come up we’d probably be making some acquisitions as well.”

Business has been picking up during the recession as the firm converts a high number of quote requests into orders, he said.

“In the utility industry, they expect very rapid and sustainable growth over the next 20 to 30 years,” he said. “More and more power is being used. I’d like to take advantage of that opportunity.”

Hammer Creek Enterprises provides corporation finance advisory services and capital to small and mid-sized local businesses. Ideally, the father-and-son team looks to both invest in a company and help it finance growth or an acquisition, said Patrick Brubaker, principal of the firm. His father, Peter Brubaker, is the president and founder of the company.

The firm got started a little more than a year ago; and while they have been involved with a few projects to date, the FEC Technologies deal is the first situation to fall in line with exactly what the duo was hoping to accomplish, Patrick Brubaker said. Within the last six months, a lot of companies have come to Hammer Creek with a need for turnaround services, he said.

“We’re not looking to run companies; we’re trying to find good management teams to partner with,” Patrick Brubaker said. “Harry needed exactly what we bring to the table, which is money to help him complete the transaction and advisory services to help him navigate through the process.”

He declined to say how much Hammer Creek invested in FEC Technologies, but said they helped refinance some debt owned by the LePage family and bought some of the equity the family was selling. The team also helped negotiate the deal between the LePages and Blok, Patrick Brubaker said.

Patrick and Peter Brubaker are now helping Blok hire a new controller, create budgets for next year and investigate leads for new business, Patrick Brubaker said.

“We feel like we may be entering a time of healthy demand for this product,” he said. “I feel like the company is well positioned for growth.”

Brian Caler, vice president of commercial lending at Lancaster County-based Susquehanna Bank, was one of the people who recommended Blok partner with Hammer Creek Enterprises to finance the deal. Caler said the bank has assisted Hammer Creek with several other transactions. The bank also has had a relationship with FEC since about 2000, he said.

“Just based upon their (Hammer Creek’s) experience, their knowledge of business and their financial expertise … we just thought that FEC and Hammer Creek would be a good fit,” Caler said. “(Hammer Creek is) looking for companies that kind of need that shot in the arm to inject some equity or cash into a company in order to make deals happen.”