It's getting lonelier at the top

BY TAMI LUHBY | tami.luhby@newsday.com

Goodbye, Long Island's list of Top 100 public companies.

This year, for the first time in the 11 years the paper has compiled this annual section, Newsday had to narrow the list to Long Island's Top 75 public companies. That's because there are no longer 100 public companies headquartered in Nassau and Suffolk. Instead, we are including the largest 75 out of the total of 95.

So where did Long Island's public companies go? Several places: Some, such as Symbol Technologies and Twinlab, were acquired by larger firms located off the Island. Others, such as Reckson Associates and Del Laboratories, were taken private. Many, including Weight Watchers International and DHB Industries, moved away. And a few, such as Acclaim Entertainment and Family Golf Centers, went out of business.

And although local banks are not included in the Top Companies list and are broken out separately, they also have been disappearing. Some have been scooped up and merged into local competitors, while others have been taken over by off-Island companies. In recent years, for instance, North Fork Bank purchased Green Point Bank and then North Fork was acquired by Capital One.

Why they're gone

The reasons are varied. Some Long Island companies just felt it made business sense to be acquired or to cease operations. Others, particularly the smaller companies that made up the bulk of the Top 100 list, did not want to deal with the regulatory burdens of being a public company and chose to go private. And it's now easier to end one's days on a stock exchange, since private equity firms, flush with cash, are scooping up companies large and small.

More than a dozen in the past six years, however, felt Long Island wasn't the place for them. They cited the high cost of doing business here -- with high salaries, energy and transportation costs, and taxes -- or the desire to be closer to their customers or manufacturing facilities.

"We do not have a favorable business environment for certain types of firms," said Pearl Kamer, chief economist for the Long Island Association. "Due to a confluence of factors, public companies have suffered a diminution. It's no one factor."

Experts differ on whether losing Long Island's public companies is a bad thing. It depends on whether the companies remain committed to the area, in terms of jobs and business spending, if they are taken private or become part of another corporation, they said. With each company, it's a different story.

Some invest in Long Island

Motorola, which purchased Holtsville-based bar-code scanner manufacturer Symbol Technologies, plans to invest in Long Island. Though it's based in Schaumberg, Ill., Motorola made Holtsville the headquarters of its enterprise mobility business and intends to grow this unit, said Brian Kyhos, a Motorola spokesman.

A year ago, Symbol employed 1,200 on Long Island. Motorola won't provide current employment numbers, but when the company was acquired in January, Sal Iannuzzi, then Symbol's chief executive, said he would be able to "count on both hands" any job losses in back-office areas during the next several years.

"With Motorola, Long Island has gained a major facility for a Fortune 100 company," Kyhos said. "Motorola's presence will elevate Long Island's profile as a high-tech hub."

It's a similar story with Netsmart Technologies, a Great River-based supplier of management technology to health and human services organizations. The company decided this year it could grow better as a private firm without the regulatory burdens and costs of complying with federal Sarbanes-Oxley legislation.

Not only is the company growing on Long Island, but its executives are very committed to the business community here, said spokesman Dave Kishler. Chief executive James Conway, for instance, serves on the board of directors of LISTnet, a group that focuses on local tech companies, and is a member of the CEO Roundtable of Long Island.

Eon is a loss for the area

But generic drug maker Eon Labs, which had about 200 people in Laurelton, is leaving the area. It was purchased by Sandoz, the German-based generic drug company and subsidiary of Novartis, in 2005. A year later, Sandoz announced it was closing the production facility to "operate an efficient and competitive organization." The lab is set to close by the end of this year and manufacturing transferred to existing Sandoz facilities in North Carolina and Colorado.

Newtek Business Services, which moved its headquarters from Great River to Manhattan last year, also is trimming jobs on the Island, though it is retaining a presence in Great River and West Hempstead, where it recently bought CDS Capital Corp. It, too, made the decision because of Sarbanes-Oxley, finding it easier to have its financial team in the same place as its main lending operations in the city, said chief executive Barry Sloane.

"We really needed to have our accounting department more closely located to where our core operations were," Sloane said. "It was easier to move 15 to 20 people than to move 70 people."

When big public companies reduce their presence on Long Island, it's not only a matter of the jobs being lost with that company. It's also the loss of jobs and opportunities for the local small businesses that work with that big public company. Messenger services, landscapers, cleaning services and office supply firms could all suffer when a big company such as Weight Watchers moves off Long Island.

"Major companies are the energizers for the secondary companies that supply them," said Martin Cantor, director of the Economic and Social Policy Institute at Dowling College in Oakdale.