Process oils could be the key to growth for Universal Oil Inc., an industrial lubricants and petroleum products supplier recently sold by its longtime owners to its employees through an employee stock ownership plan (ESOP). The company has 25 full-time employees.
On Jan. 31 brothers Bob and Tim Mendelsohn, who had owned the privately-held, Cleveland-based company for 30 years, signed papers to sell Universal Oil for an undisclosed amount. The Mendelsohns will remain involved with the company as members of its board of directors and the ESOPs advisory committee.
Universal Oil will continue to be the sole distributor in northeastern Ohio for Chevron and Texaco products, Houghton International and Summit Industrial Products Inc.
A very significant part of our business is distributing lubricants, oils, greases and a variety of products we get from Chevron under the Chevron product name, new Universal Oil President John Purcell told Lube Report. We also do some private branding here of our own products that we blend for very specific applications in the metals industry and for customers in the local area.
Purcell said the companys clients include a number of municipalities and suburbs in northeastern Ohio. We also serve a number of fleet customers, customers who have a significant number of vehicles, Purcell added. Were selling them in some cases fuel, but in a lot of cases motor oil, transmission fluid and so on.
He explained that a separate area of the business involves process oils for customers to use in machinery, often in metalworking operations. One of the growth areas incredibly important to us is process oils, Purcell said. We want to be a bigger provider of lubricants and process oils to a variety of different kinds of companies in our local market. Its incredibly valuable to us, we think weve got a great product line and we think were pretty good technical problem-solvers.
Purcell said growth is the holy grail for the company. If we grow the business and make it more profitable, we the employees are the beneficiaries, he said. Thats one of the strengths of the ESOP.
Universal Oil is a third-generation business, started by the Mendelsohns grandfather. Bob and Tim Mendelsohn took over from their father 30 years ago. We have employees here who are third generation and actually worked for Bob and Tims grandfather, Purcell said. Its a pretty positive place to work, and I think employees have a real sense of belonging, which transcends well into sense of ownership.
He said the Mendelsohns, seeking to retire, went through a diligent process for more than a year evaluating different options before deciding on the employee stock ownership plan. It enabled them to sell the business to employees, and get the value they were looking for, while simultaneously ensuring the business stayed in Cleveland and stayed in the hands of people they had worked with for 30 years, Purcell said.
Purcell has a background in manufacturing and distribution, including 16 years with E.I. DuPont de Nemours and Co., and three years with Avery-Dennisons automotive division in Troy, Mich. The ESOPs other advisory committee members are Tom Green, treasurer; Larry Elko, a long-term employee; and the Mendelsohns.
Purcell has assured employees and customers there are no plans to the move the company. Universal Oil will remain in the same location on Clevelands Jefferson Avenue that it has occupied for the past 100 years, he said.