Last week, Jim Frakes, President of Frakes Engineering, sold the company that he and his brother, Bill, founded 37 years ago to his 42 employees. Frakes Engineering is a 100% employee owned company, with the transfer of 100% of the outstanding shares in the company to the ESOP Trust.
“Jim Frakes has always felt the future of the company belonged in the hands of those that made it what it is today, the employees,” Cliff Campbell, General Manager of Frakes Engineering said. “We have such a family feel to the place because most of us have been here for a very long time and already view it as our firm. What we have done here today will ensure that Frakes Engineering continues for the benefit of our clients and employees for many generations into the future.”
The ESOP will not change Frakes Engineering’s current management, services or business objectives, but it will promote participation and leadership on every level and from every employee. As an ESOP, all employees will have the right to contribute to the management, strategy and financial health of the company. Due to employee ownership, companies thrive and statistically have a better track record.
The ESOP plan has also given Frakes Engineering a succession plan and a way for the Frakes family to preserve its legacy in the company. An ESOP is 25% more likely to stay in business, has 25% higher job growth than non-ESOP companies, and contributes 2.5 times as much to employee retirement accounts.
Frakes Engineering is a Control Systems Engineering firm founded in 1978 by Jim and Bill Frakes. Together they built Frakes Engineering into one of the oldest and largest System Integration firms in Indiana. The company currently operates in a diverse mix of industries such as Municipal Water and Wastewater control systems and Advanced Manufacturing in Automotive, Pharmaceutical, Plastic and Food & Beverage. They develop and deploy systems focusing on SCADA, Robotic Work Cells, Vision based inspection, functional machine safety and cybersecurity for control systems.
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