Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, August 24, 1995 TAG: 9508240062
SECTION: BUSINESS PAGE: B8 EDITION: METRO
SOURCE: JEFF STURGEON STAFF WRITER
DATELINE: LENGTH: Medium
Officials from A.O. Smith Manufacturing of Wisconsin, who broke ground Wednesday for a $25 million factory in Botetourt County, first met local leaders in January to begin project talks with a peculiar-sounding request: They wanted to be anonymous.
The company's John Does laid out exactly what they wanted: a site for a heavy manufacturing plant, served by railroad, in a community with a good work ethic. They specified how much they would spend and how soon they could act.
"We knew everything except the name of the company," County Administrator Jerry Burgess said after Wednesday's ceremony.
It is a little-known fact of corporate recruitment that local officials sometimes must court prospects during a sort of industrial blind date. A.O. Smith's point man, Dale Hemberger, was known to Burgess simply as Dale. Burgess' team referred to the strangers as the people behind "the Mullis prospect," after a national relocation consultant company, J.M. Mullis of Collierville, Tenn., helping A.O. Smith with the search.
Companies operate in secrecy to avoid tipping off competitors to strategic moves or giving landowners a chance to think about raising the price of desired property; or to make it easier to bow out of talks if a company sours on a community under consideration. Finally, secrecy can spare employees needless worrying about a relocation before plans are solid.
Three times, the business people came to Botetourt County, talked to Burgess and his staff and went away. A.O. Smith officials finally identified themselves and the company to solicit a serious offer from Botetourt County.
Burgess' ears pricked up in the meeting at which A.O. Smith came clean, and he was gladdened by what he heard. "I knew the A.O. Smith name immediately. A light bulb went off in my head, saying, 'I think we want these guys.'''
A.O. Smith is a billion-dollar manufacturer of a diversified line of products, based in Milwaukee.
Its search team had begun looking in Virginia first by calling state officials, who shared the lead with the Roanoke Valley Regional Economic Development Partnership. The partnership invited Botetourt County officials into negotiations.
By the time the deal was signed, 20 local organizations and businesses had helped in some way, such as the company executives who briefed A.O. Smith on the reliability and skills of local workers, Burgess said.
The county's offer to land the Smith plant was on par with the grandeur of the company's vision. In return for 41 hilly acres of free land worth $268,000, A.O. Smith will plunk down the largest investment ever for a new plant and equipment in Botetourt County.
The plant, measuring a nick under 200,000 square feet, will build custom frame rails - the backbone of heavy trucks. The rails will go to Volvo GM Heavy Truck Corp.'s plants in Dublin and in Orrville, Ohio, and to truck maker Freightliner's plants in Cleveland, N.C., and Mount Holly, N.C.
Botetourt County will open its wallet to provide other incentives, including $150,000 for site preparation including a railroad spur for steel deliveries. Burgess said the county will tax A.O. Smith an amount equal to what is being paid out in incentives within two years of the start of production, scheduled in fall 1996.
Meanwhile, Virginia taxpayers will contribute at least $450,000 to the project.
A.O. Smith plans to hire about 65 employees next year, and more later if economic conditions allow. The company would not say what it will pay, but sources have put the figure at $11 per hour.
By Wednesday's ceremony, the vow of secrecy had long worn off, but the use of first names stuck, as company and government officials behaved like old friends - shaking hands and admiring the grassy hilltop on which they will build a future together.
by CNB