July 1 Article on the Sale

Photo Gallery of IBM Endicott from the Press & Sun-Bulletin

Officials: IBM was set to close
Pataki: 'This entire facility has been at risk'

Thursday, July 4, 2002

BY JEFF PLATSKY
Press & Sun-Bulletin

ENDICOTT -- State officials are convinced IBM Corp. was set to sell its Endicott Microelectronics Division and eventually close the entire site before a deal was reached this week, but IBM refuses to confirm that was its plan.

Visions of an abandoned IBM complex that would present, at best, a redevelopment challenge drove state officials to hatch a plan to sell the expansive industrial site to local investors.

"This entire facility has been at risk," Gov. George E. Pataki said. "They said it was going to be sold."

For their part, IBM representatives were coy about their exact plans for the Endicott site. They acknowledged that their strategy included plans to exit manufacturing, a move that would have left Endicott's microelectronics in limbo.

"We are focusing on an agenda where we can be most competitive," said Todd Martin, spokesman at IBM Endicott, referring to an early June announcement of a restructuring at IBM's Microelectronics Division.

Were the operations in Endicott ready to be sold? Was closing the Endicott site a possibility?

State officials say "yes." IBM representatives won't indicate what would have happened if the microelectronics operation had not been sold to local investors.

"There were some inaccurate statements on what IBM's situation was," Martin said, referring to the governor's statements about Endicott's impending closure.

State officials, however, were almost certain that the Endicott manufacturing operations were on the verge of being sold.

"We believed the direction of this whole global downsizing (at IBM) was not a positive for us in Endicott," said state Sen. Thomas W. Libous, R-Binghamton.

Libous, with the governor, engineered the sale of the manufacturing operations and the eventual transfer of 2,000 people to the new company.

The new owners said IBM had the clear intention of selling the microelectronics operations to another party.

"IBM was having discussions with other companies," said James W. Orband, chief counsel for Endicott Interconnect Technologies, the locally controlled company that expects to take over the operations within the next three months. "IBM had been entertaining other options."

On Monday, the state announced the microelectronics business in Endicott is being sold to a company controlled by local businessmen, the Maines and Matthews families. Between them, the two families have a wide array of holdings, including food distribution and electronic subcontractors.

State officials portrayed the arrangement between the local investors and IBM as the best possible scenario for the community.

John E. "Jack" Cheevers, Town of Union supervisor, said closing the Endicott site was a "strong likelihood" under alternate plans.

IBM managers told workers Monday a deal was almost struck with Sanmina Corp., a multibillion-dollar contract electronics manufacturer with a plant in Owego and headquarters in California.

"They came within an inch of buying the place," Cheevers said. "If it was sold to Sanmina, they would have taken the jobs offshore the next day and bulldozed the place."