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Mechanical contractor in St. Paul grows with D.C. deal

  • Article by: NEAL ST. ANTHONY
  • Star Tribune
  • July 3, 2012 - 11:22 AM

St. Paul-based Harris Companies, one of the nation's largest mechanical contractors, will close next week on the acquisition of a Washington, D.C.-area commercial contractor. The deal will diversify Harris' territory and give it more access to government-related work.

Harris CEO Greg Hosch, 41, said the opportunity to acquire R.M. Thornton of Capital Heights, Md., arose through a longtime relationship with the majority owner of the smaller company. He approached Harris as he neared retirement.

"It's a mechanical contracting company, just like ours," Hosch said. "Historically they have revenue of $30 million to $40 million, and about 110 employees. On July 2, substantially all of those employees will transfer to us. They've got about 90 in the field and 20 in the office.'' The acquisition price was not disclosed.

Thornton will continue to operate under the Thornton name and will become a subsidiary of Harris.

"We believe the Washington, D.C., marketplace is somewhat countercyclical, so we're adding some diversity to avoid the wild swings of revenue that the construction market typically brings,'' Hosch said. Thornton does a lot of federal government work, which ranges to 50 percent or more of their business. Our fixed locations have always been in the middle and west of the country. We're doing a job in Virginia now. And as our customers move about geographically, we want to be positioned to serve them."

Hosch, an engineer who joined Harris in 1993, took over as CEO in 2005 and has pushed the employee-owned company's geographic expansion as well as expertise in energy conservation and alternative technologies. The emphasis has led to an increased portfolio of government and commercial projects.

Hosch said revenue is growing at its best clip since before the recession. Harris's project backlog totals nearly $200 million worth of work in the pipeline, a record.

Harris Companies has about 1,000 employees. It expects revenue of about $210 million this year.

Engineering News Record said Harris was the 13th-largest mechanical contractor in the nation in 2011.

Neal St. Anthony • 612-673-7144

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