Good Afternoon
Good Afternoon

MSC sets up co-headquarters in N. Carolina

Stock of MSC Industrial Direct Co., Long Island's

Stock of MSC Industrial Direct Co., Long Island's seventh-largest public company in terms of revenue, jumped after Chase bought nearly 4 million of Melville company's shares. Credit: Newsday / J. Conrad Williams Jr.

Melville-based MSC Industrial Direct Co., Long Island's seventh-largest public company by revenue, Wednesday said it plans to establish a corporate headquarters in suburban Charlotte, N.C., while maintaining its existing headquarters in Melville.

The company stressed that it plans no layoffs.

As part of its strategy to "co-locate" to Davidson, N.C., the distributor of industrial tools and supplies plans to build a 180,000-square-foot customer-service center there and create more than 400 jobs. It said it will receive $14 million in tax and "other incentives" over 12 years from the state of North Carolina and local municipalities.

MSC said it would invest about $31 million to construct the new facility. The company had revenue of $2 billion in its fiscal year ended August 2011. Its plans depend on receiving formal governmental approvals in North Carolina.

The distributor decided on Davidson because of access to greater numbers of employees with industrial skills, said Erik Gershwind, president and chief operating officer. He said the company didn't seek incentives from New York State but instead focused on picking the best place to expand. But Gershwind stressed that the company will remain incorporated in New York. He also said that any staff expansions would primarily happen in Davidson.

"For the foreseeable future, given that we are starting with such a small base, I would say that the majority of our expansion in associate population will be there," he said.

MSC has had offices in North Carolina for more than 15 years and has more than 60 employees around the state. the company has 4,663 full-time employees, including 664 full-time employees on Long Island.

"We are firmly committed to both locations, and we would not anticipate layoffs," Gershwind said.

It's not unprecedented for a local company to have more than one headquarters, said Jim Morgo, former chairman of the Suffolk County Industrial Development Agency and president of Morgo Private Public Strategies. He noted that Great River-based Netsmart Technologies Inc. has two other corporate locations.

He said whether a company stays or goes usually depends on where the chief executive lives, as was the case with Arrow Electronics, which last year moved its headquarters from Melville to Colorado, where its CEO lives.

Gershwind, 40, who is in line to become chief executive by next year, said he is staying on Long Island.

"I plan to be in the job for many years, and I am going to be doing it right here," said Gershwind, who grew up in Great Neck and lives in Brookville.

The relocation of public companies from Long Island to lower-cost states has become an economic and political issue. Suffolk County Executive Steve Bellone said in a statement Wednesday, "While we regret that the company did not choose to expand on Long Island, we welcome the opportunity to continue discussions with the company regarding their co-headquarters located in Melville."

More news