Announcement of New Organizational Management and Key Changes at Kovatch Castings, Inc.
January 06, 2020
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.