By Breana Noble, Candice Williams, The Detroit News
Over a century of entrepreneurship documented in books and film, Michigan became a headquarters hub for office furniture manufacturers in Grand Rapids, cereal producers in Battle Creek and automakers in Metro Detroit — enviable generators of high-earning employment, civic influence and philanthropic support.
But merger and acquisition activity in recent decades has sent long-standing Michigan business leadership at many companies out of state and even the country, weakening Michigan’s status as home to some of the nation’s most recognizable, independently owned brands.
“We’ve lost some of the business titans that were defining elements of the latter half of the 20th century for the state of Michigan,” said Patrick Anderson, CEO of East Lansing-based consulting firm Anderson Economic Group.
Mergers and acquisitions can offer expansion into new markets, access to more capital to innovate and scale to lower costs. But such moves also often come with consolidation, layoffs, fewer local decisionmakers and a decline in community philanthropy fueled by corporate dollars.
Ferrero SpA, the Italian company behind Ferrero Rocher chocolates, in September acquired Battle Creek-based WK Kellogg Co. in a $3 billion deal. HNI Corp. in Muscatine, Iowa, in December bought Grand Rapids-based office furniture giant Steelcase Inc. in a $2.2 billion cash and stock deal. Both transactions will leave regional or brand headquarters in their respective cities.
Those, however, are just Michigan’s latest corporate headquarters losses.
New Hampshire’s C&S Wholesale Grocers LLC in September acquired food distributor SpartanNash Co. of Byron Center outside of Grand Rapids. Ohio’s Huntington Bancshares Inc. in 2021 acquired Detroit-based TCF Financial Corp., formerly Chemical Bank in Midland, leaving a “dual headquartered” situation with the commercial banking headquarters in the Motor City.
Plymouth Township’s electric vehicle startup Rivian Automotive Inc. in 2020 chased software talent to California. Midland’s Dow Inc. is smaller in scale after Dow Chemical merged with E.I. du Pont de Nemours and Co. in 2017, splitting the tie-up into three separate, specialized companies in 2019. Boston-based private equity firm Thomas H. Lee Partners in 2017 acquired Art Van Furniture, which filed for bankruptcy in 2020 to have its operations acquired by Loves Furniture, which went bankrupt in 2021.
Auto supplier Delphi, a spinoff of General Motors Co., in 2017 moved its headquarters to Ireland from Troy following a protracted bankruptcy. In 2012, Post Consumer Brand relocated its headquarters to Lakeville, Minnesota, from Battle Creek, after spinning off from Kraft Inc. Comerica Inc. in 2007 moved its headquarters to Dallas from Detroit and now is being acquired by Ohio-based Fifth Third Bancorp.
Sears, Roebuck and Co. in 2005 bought Troy-based Kmart Corp., whose last U.S. mainland full-size store closed a year ago. Chrysler Corp. in 1998 merged with Daimler-Benz AG, beginning a series of switches, including through its 2009 bankruptcy; it now is owned by Dutch-domiciled Stellantis NV. Portage’s The Upjohn Co. merged with Pharmacia in 1995 and most recently was acquired by Pfizer in 2003. In 1994, Fremont-based Gerber merged with Sandoz Laboratories and is now owned by Nestlé SA.
Mergers and acquisitions are a natural part of the business life cycle, said Matt McCauley, Michigan Economic Development Corp.’s senior vice president of regional development. Those actions are intended to result in a net positive, whether that’s access to new technologies, talent, assets or capital.
“Michigan has an excellent value proposition as it relates to business,” McCauley said, referencing the state’s high concentration of engineers, strengths in higher education institutions and history of innovation. “People want to come to Michigan, invest in Michigan, invest in communities, invest in people within Michigan, and there’s a variety of ways to do that.”
Steelcase and furniture
The COVID-19 pandemic disrupted the office furniture manufacturing business as it changed the way many people work. Artificial intelligence is poised to do that again, said Jim Hackett, who worked for Steelcase for nearly 20 years as CEO before leaving in 2014.
HNI’s acquisition of Steelcase, Hackett said, is a doubling down — it’s combining with a company that is in the same position as Steelcase. When he was CEO, Hackett considered acquisitions, but decided against the tie-ups because he thought they didn’t advance the business for the future. The company did, however, establish a presence in Palo Alto, California, to monitor the startups and entrepreneurs that offered an early warning system on the way technology was affecting work.
“Myself, personally, I would have liked to go it alone, and the reason for that is that the company they merged with is going to face the same kind of pressures: that the return to work from COVID took too long and there are preferences by workers to not sit in offices when they can work other places,” Hackett, who lives in Grand Rapids, said in an interview with The Detroit News. “It’s a fine company (HNI). I just think that the evolution of work is probably a more important beacon.”
A request for interview to Steelcase on the acquisition was declined.
Upjohn in Portage
Jeremy Winkworth spent 37 years with The Upjohn Co., Pharmacia and Pfizer before retiring in 2017. When he joined in 1980, “nobody in the 100-year history of the Upjohn Company had been laid off,” said the 70-year-old, who spent stints in the quality group’s analytical laboratory and computer and business support.
“It was a family-owned pharmaceutical company, and because the leaders of the company lived in the same community, they felt like ‘we need to do the best for our employees, because they’re our neighbors,’” said Winkworth, who runs upjohn.net, a website dedicated to the company’s legacy.
Most employees learned about the 1995 merger between Upjohn and Pharmacia through local media and internal emails. Corporate headquarters moved to London, England, while research and development and sales remained in Kalamazoo.
The biggest shake-ups came later when Upjohn and Pharmacia merged with Monsanto and was renamed Pharmacia in 2000, followed by Pfizer’s acquisition in 2003, with each resulting in layoffs. Research and administrative functions were hit hardest, Winkworth said, affecting downtown Kalamazoo businesses that relied on the workers.
Today, the Upjohn name mostly has disappeared from public view. The upper facade of a former Albert Kahn-designed building that once served as its headquarters on John Street in Kalamazoo still bears the name.
Pfizer donated the building to Bronson Healthcare in 2005, and it was placed on the National Register of Historical Places in 2022, according to the Kalamazoo Public Library. The W.E. Upjohn Institute for Employment Research also is a nonprofit focused on economic development.
In a statement, Pfizer said its Kalamazoo site is one of the largest in its network, “producing critical medicines for patients around the world. We remain committed to our operations in Kalamazoo, which plays a crucial role in our global supply network.”
Gerber in Fremont
Swiss company Sandoz Laboratories in 1994 bought Fremont-based Gerber. It offered the 1927-founded Michigan baby food brand an opportunity to expand internationally. Sandoz two years later merged with CIBA-Geigy to form Novartis AG, one of the largest pharmaceutical companies in the world. Nestlé acquired the company in 2007.
“There’s always that fear when a company’s bought,” Fremont City Manager Todd Blake said, though he noted many of the top Gerber executives didn’t live in town.
The city of Fremont knew there was interest in selling the Gerber plant while it still was under Novartis. City, state and company leaders sought in Lansing a renaissance zone designation for the property that offers tax exemptions, though it hadn’t been used for an agriculture site before. In 2008, Fremont secured the designation for Gerber, which was renewed in 2020 for 10 years. In the past five years, Nestlé has invested $150 million into Fremont.
“The continuity of the employees to stay here — that helps support the economy and our community,” Blake said.
More than 700 employees work in the company’s factory, a Parent Resource Center, and a research and development center. Being a part of Nestlé has offered greater efficiencies and nutrition expertise, according to the company. Fremont’s population in the last census grew by more than 10%. It has two housing developments in the works. With neighboring communities, it’s attracted Meijer and Aldi to the area.
Blake noted the city spent a year on a land-swap agreement to create a closed campus for Nestlé: “It takes quite a bit longer to get through the channels. But it was worth waiting for.”
Michigan commitment, growth
There are corporations committed to calling Michigan home. Dearborn-based Ford Motor Co. last year began its move across town to a new headquarters building dubbed “the Hub.” General Motors Co. is leaving the Renaissance Center in downtown Detroit for a much smaller space in the new Hudson’s Detroit complex less than a mile away.
Detroit-based mortgage giant Rocket Cos. Inc. closed in July its acquisition of real estate listing app Redfin, and in October, it acquired Texas mortgage servicer Mr. Cooper, which had acquired Ann Arbor’s Home Point Capital in 2023. American Axle & Manufacturing Holdings Inc. expects to close on its acquisition of auto supplier competitor London-based Dowlais Group plc in the first quarter of 2026.
Howard Holmes II, CEO and president of 137-year-old Chelsea Milling Co., home of Jiffy mixes that his grandmother invented, said the company’s location in Michigan advantages it to be the majority leader in market share for U.S. muffin mixes. The state offers central access to Midwest agriculture commodities via its nearby highways and the railway that runs through the company’s property.
Although Holmes declined to share financial details, he said the company is healthy. Its food service business is growing, new products will debut this year, and it sees the potential for acquiring other companies as a way to grow and modernize.
Chelsea Milling is a private company with a small share of owners whom Holmes declined to disclose. He said the company “never ever” will sell, however. Staying private, he said, has allowed the company to weather storms that might have been more difficult to manage if it was beholden to public investors.
