Kummer Looks to FMI to Facilitate Sale of HBE Corp

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{HBE Corp's 50K sq ft, $73M Goleta Valley Cottage Hospital in Goleta, CA currently under construction – image from hbecorp.com}

According to WhoLou sources, HBE Corp. president and CEO, Fred Kummer has hired North Carolina-based engineering and construction consulting firm FMI to help facilitate the sale of his interest in the company. Having played a role planning, designing, or building more than 1,000 hospitals since founding the firm in 1960 Kummer has built HBE Corp. into a leader in national healthcare design-build construction and one of the largest privately held companies in the St. Louis area.

HBE Corp. employs approximately 300 people and is headquartered in Creve Coeur. During the early 2000s the company was also the largest designer and builder of financial institutions, credit unions, savings and loans and banks in the country. HBE Corp. revenue was reportedly down nearly 9% in 2011 from 2010 to just over $279 million. According to the St. Louis Business Journal HBE Corp. ranked No. 63 on its 2012 list of the top 150 privately held companies in St. Louis and recently ranked first on Modern Healthcare’s Top 10 list of hospital design/build firms in the country.

WhoLou sources further allege that FMI previously was involved with HBE Corp. in 2008 when Kummer initiated an employee stock ownership plan that transferred some control to employees but left him and his wife retaining majority ownership in the company. Prospective buyers have allegedly been turned off by the sale because Kummer is still very active in day-to-day operations at HBE Corp. and the octogenarian plans on staying involved in some capacity the next two or three years.

Kummer’s official reply to WhoLou requesting information regarding the hiring of FMI and the potential sale of his interest in HBE Corp. was, “No comment.”

UPDATE 10/31/2012 – Fred Kummer reached out to WhoLou Wednesday morning wishing to now comment. Kummer told WhoLou that he does have a succession problem but denied source information regarding currently having a contract with FMI. Kummer further explained that he has had a business relationship with FMI over the last 30 years. Though Kummer told WhoLou that he does not have the firm currently under contract he also admitted to still receiving counsel from FMI executives he has grown close to over the past three decades.

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  • Urban

    It was eventually going to happen. Kummer didn’t want to give away any control because he couldn’t let his ego go. The companies’ health mimics that of Kummer’s 85 year old health. It sure is a shame. This company had around 600 people employed in the 80’s, and now is slowly passing away like the owner. I feel bad for the young workers and their families losing income because the “old man” couldn’t give the company up to others to run and continue on with.

  • Andrew

    Any news on this? Biz journal reported that HBE is closing?

    • Architect seeking employment

      HBE has indeed started the path to closing completely. Nearly all the 200+ employees have already been laid off within the past few months, myself included. Some employees had tenures of over 20 – 30 years there. A few upper management brass and those overseeing projects still in construction currently remain.

      • RPK

        Sorry to hear.

      • RPK

        Sorry to hear.

  • Christina

    I wonder what will happen to all of the workers.

    • Alex Ihnen

      This story is about business succession and who will run one of the top hospital design/build firms in the county. There’s no reason to speculate on, or suggest, that employees will be affected. To be clear: HBE is a successful and profitable company and will likely continue as such. This is simply about the company’s founder eventually selling his stake in the firm.

      • Duane

        They treat their employees great!!!

        • Duane

          They have their own hbe cafeteria on the first floor! It’s open during most of the day but don’t go too often, otherwise you will have to sign out. Signing out is good, it is a part of most firms. If you go to the bathroom – sign out. if you go to another floor – sign out. Also, if you don’t tell the receptionist where you are at all times, well, her job is to report it to mr. kummer.

          Cameras are in all the stairways – don’t try to sneak in if you are late since you will be caught. Cameras all over the floors so be a good employee -It keeps a super team environment.

          Office hours are 8-5pm Lunch is 12-1pm sharp. I have nothing bad to say, they are hours. There are many people who have been there 15, 20, 30 years or longer! They are there to help you keep things the way the need to be – profitable. With Mr. Kummer there to dictate every decision, you are always assured of a bonus at the end of a year!! They often have job openings too. Apply!

          • Alex Ihnen

            This isn’t the proper forum to express personal issues with an employer.

      • Duane

        It’s a great business definitely. Is it legal to have workplace mock elections? Mr. Kummer would never hold a mock election in the work place just weeks before the elections for kicks.

        Mr. Kummer would never send out a company wide memo passively suggesting an Obama win would be bad for their company. The recent layoffs were probably due to bad work ethic.

        • Kim Ruffino

          Hey Duane, you sound like yo know alot baout the company. i would like to hear more….

          • BBQ King

            I’ve got some stories.

        • Nature Boy

          HBE closing. Thanks Obama. Woooo!

          • Urban

            yeah sure, be a wimp and blame Obama for the old man not knowing how to run a company

          • RPK

            Urban – The HBE closing was cited by BizJournal as being due to the current administration’s changes in Healthcare. Mr. Kummer started and operated a multi-million company for 50+years, its fair to say he knows how to run a company.

          • Alex Ihnen

            That’s not correct. The Business Journal did not cite a reason for changes at HBE, it quoted Kummer as saying that they are not building new hospitals due to “the very real changes that the current administration in Washington has brought about in healthcare”.

          • Alex Ihnen

            That’s not correct. The Business Journal did not cite a reason for changes at HBE, it quoted Kummer as saying that they are not building new hospitals due to “the very real changes that the current administration in Washington has brought about in healthcare”.

          • RPK

            Urban – The HBE closing was cited by BizJournal as being due to the current administration’s changes in Healthcare. Mr. Kummer started and operated a multi-million company for 50+years, its fair to say he knows how to run a company.

          • Justin Bear Case

            Hard to swallow that he couldn’t run a business and last as long as he did. I worked for him almost 10 years and it was a good experience.

      • Architect seeking emploment

        Original poster was correct. Employees were affected…almost all have been laid off. Company closing after 50 years. Unbelievable. So much for successful and profitable I guess.