Industry News Kovatch Castings Inc. Announces Employee Stock Ownership Plan
Kovatch Castings Inc. (KCI)
celebrated a recent change that set in motion a strategy for future stability and success. At a company-wide meeting, Doug Kovatch told KCI employees that they have become the new owners of the company through an Employee Stock Ownership Plan (ESOP). Doug Kovatch is selling 100% of the business to the ESOP, and will be staying on as the company’s Chief Executive Officer (CEO).
The transition to employee
ownership allows KCI employees to continue the company’s rich tradition of superior service and quality for many years to come. “This accomplished two important goals for our company’s future. First, we found a great way to reward our valued employees for all they have done to
build the business over the years. And second, it establishes a sound strategy for ownership succession for Kovatch Castings. We have a strong leadership team in place that demonstrates a high level of skill and possesses the integrity and ethical qualities upon which the company was founded by my father, Frank Kovatch,” says Doug Kovatch CEO of KCI. Tom Planz will take on the role of
President of KCI and continue to manage the day-to-day operations. “With this approach to ownership transition we keep going without missing a beat. We’ll maintain everything that’s great about KCI and transition to new ownership smoothly,” explains Planz. Tom joined KCI as Director of Operations in December 2014. Tom is a proven leader
with 38 years of experience in the
investment casting industry. An ESOP is a retirement benefit that enables employees to own the company where they work through a qualified retirement trust fund. There are approximately 7,000 ESOP- owned businesses in the United States, employing millions of employee owners. Kovatch Castings Inc. is now part of an impressive group of businesses in the U.S. that share ownership through this unique retirement benefit. According to the National Center for Employee Ownership
(NCEO), ESOP-owned
businesses tend to grow faster and create more new jobs than comparable conventionally owned firms.
Doug Kovatch’s Comments on Kovatch Castings’ History Kovatch Castings Inc. began
operations in Akron Ohio in September of 1976, with Frank Kovatch and his two Brothers, Paul and Ed, all collateralizing their homes and risking everything. Additional funding came from a third Brother, Steve, and a close family friend, Adam Burghardt, who owed a fabricating business in Akron, Ohio. “It was a remarkable story of guts, determination and European work ethic that drove them, along with their personal belief in God and wanting the family name to live on into the future. Their efforts have allowed us to have an impact in our community and around the world”, says Doug Kovatch. From a very humble and under- capitalized start, these brothers, along with many more who came up alongside them, all worked ridiculous hours for the first eight years. In 1984, new business and the Company’s first new piece of equipment was purchased. The Kovatch
®
family had turned the corner and business sales improved dramatically. Based on Frank’s beliefs to always
do the right thing and put people first, his efforts were rewarded. In 1991, Kovatch built a new state of the art facility south of Akron in Uniontown, Ohio. The next generation of leaders, including Frank Lysiak and Doug Kovatch, along with a host of others, took the company to the next level of success. In 2000, Doug took over as President
and added ISO 9000 and AS9100 quality systems, soon after adding Nadcap for NDT and welding. Since then, the company has also completed two major expansions
along with the of adjacent land and buildings.
purchase “Our
Quality Systems and business growth could not have been accomplished without the excellent leadership support provided by Martin Prenosil, Quality Manager, and Dave Everly, Engineering Manager, and their teams” says Kovatch.
Today, Kovatch Castings has continued its growth pattern over the last several years by focusing on complex shapes, thin walls, close dimensional tolerances in corrosion and heat resistant alloys, and employs over 200 in a ‘24/7’ operation. “I am very grateful for my father’s
vision to risk it all and start KCI. Over the years, we have been very Blessed and fortunate to all those who have helped us succeed. I now turn over the leadership to Tom Planz and our wonderful leaders and employees.
I
trust they will continue to operate our company based on the values we were founded on”, says Doug Kovatch.
February 2020 ❘ 99
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