A Detroit Lakes-based control technology company was acquired by a private equity firm in June for an undisclosed amount; bringing secured retirements to many long-term employee shareholders, a company official said.
SJE, a locally headquartered company featuring brands like, CSI Controls, PRIMEX, and SJE Rhombus, was bought by Audax Private Equity, a multi-billion dollar firm with offices in Boston, New York and San Francisco, on June 17, 2021. The sale locked in high share sales prices for SJE's longtime employee share holders. The company has been under an Employee Stock Ownership Plan since 1987.
"What (the sale) allows us to do is that all employees were able to lock-in at a nice return," said Jay Dienst, vice president of marketing at SJE. "Especially, the people that have been here for quite a while. It was a really nice reward, to the point where, for a number of people, their retirement is now secure."
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SJE now employs nearly 500 people worldwide through seven different locations after beginning in the garage of the company's founder, Steve Johnston, where he created the original Tank Alert alarm in 1975 to warn users when their water, or sewage, tanks reach a preset level.
"To me, when we made this announcement, I just wondered what Steve Johnston, if he was in his garage, would've thought about our company ever getting to 500 employees and over $100 million in sales," said Dienst. "That to me is what just makes this very special for our employees and the history and the culture."
He also said the new owners have let the business continue with its normal operations after the sale and no employees have been let go in the ownership restructuring.
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"Really, it's just kind of business as usual," said Dienst. "Audax, they don't operate companies, what they do is they buy performing companies and invest in the leadership, so, to date, we've had very little interaction with Audax … all of our brands stay the same, our websites are all the same, and no one lost their jobs."
Sometimes a perception is created when equity firms buy smaller companies, he said, where they think there will be mass layoffs and massive restructuring, that isn't the case with Audax.
"Part of the benefit of working with someone, like an Audax, is what they want to do is support the management team to go out and make acquisitions to build the business," said Dienst. "By doing this transaction, this allows us to more financial resources and then they also provide leadership to help us identify a few candidates that might be a good fit and then kind of work the process."
This access to capital and other resources will let SJE grow even faster than it did on its own, he said.
Currently, SJE has no plans to move its headquarters out of Detroit Lakes, Dienst said.
"We have had discussions about expanding our facility in Detroit Lakes because we're growing very, very fast and we could use the additional space," he said. "Our headquarters is still going to remain Detroit Lakes."
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