Parsons workers own firm

Employees purchase remaining 70% of Landover company

Paper products

May 04, 1999|By Sean Somerville | Sean Somerville,SUN STAFF

The roughly 300 employees of Frank Parsons Paper Co. Inc., who had held 30 percent of the Landover-based paper distributor's shares, have purchased the remaining 70 percent, the company said yesterday.

Doug Parsons, former chief executive officer and son of the founder, had owned about 65 percent of the company's shares with his brother, David, who is not in the business.

"Because of the importance of the business to our family, my brother and I took the view that we had the responsibility to continue it," said Parsons, 60, who is retiring from the company. "And we feel like the people who have made it what it is, is the employees.

"I can think of no better way to reward their hard work, commitment and loyalty than to let them continue the legacy my father started over 60 years ago."

Frank Parsons Paper, which owns the Baltimore-based White Rose Paper Co., sells paper, office products and industrial packaging.

Frank Parsons Paper has warehouses and offices in Lansdowne; Landover; York, Pa.; and Charlottesville, Va.

The White Rose warehouse on Hollins Ferry Road employs about 75, including truck drivers, sales people and warehouse workers.

Privately held Frank Parsons Paper, founded in 1938 with three employees and a truck in a Washington storefront, did not release financial details of the deal.

Parsons said the deal would have little effect on the company's day-to-day operation. Arthur Keleher, previously president of Frank Parsons Paper, will become chief executive.

"It's very upbeat around here," said Dee Curran, executive vice president of White Rose.

"Before, employees owned 30 percent; now they own 100 percent. I think employees realize what we have before us. And everyone is very enthusiastic."

White Rose Paper was founded in 1947 and acquired by Frank Parsons Paper in 1972.

Doug Parsons and his brother started working toward the 100 percent employee ownership about a decade ago.

In 1991, Parsons introduced an employee stock ownership plan, which gave workers roughly the equivalent of five weeks of pay in stock every year.

Last year, when employees owned 30 percent, the company structured a plan to allow employees to borrow enough money to buy the 65 percent owned by the Parsons brothers and the 5 percent owned by a few other investors.

The deal was signed Wednesday and became effective yesterday, with the beginning of the company's fiscal year. First National Bank of Maryland assisted in the transaction.

"If I had misgivings, I wouldn't have done it," said Parsons, who plans to travel with his wife during his retirement.

Parsons said one of his sons is a salesman for the company, but he did not object to the sale. Family control has become very difficult for all but the smallest businesses. Families either have to fight off large competitors or give in to offers to buy the company.

"In our business, being independently owned is the exception rather than the rule," he said.

He said Frank Parsons Paper thrived because it was independent. Customers enjoyed being able to easily reach the person in charge, and they did not have to deal with bureaucracies.

Employee ownership should help Frank Parsons Paper continue to hold market share -- as an independent company, Parsons said. "That's the plan," he said. "But there's no guarantee."

Pub Date: 5/04/99

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