DIXON – SGS Refrigeration’s growth shows no signs of cooling, so the company has bought the former Anchor Coupling building at 1100 Anchor Road.

SGS makes industrial refrigeration products, mainly for food and beverage companies. Its customers include Walmart Distribution Centers, Tyson, Simpli, and Excel Meats.

The company’s manufacturing operations are at 827 W. Progress Drive in Dixon, and since starting production there in fall 2013, the business has grown.

“We’ve gone from a handful of employees to 45 in 3 years, and as growth continues, we could see 10 percent employment growth this year,” said Ray Schmidt, vice president of operations and engineering for SGS.

SGS will keep production going in the Progress Drive building that once served as a warehouse for CenturyLink. The company already is using the newly acquired 35,000-square-foot building for storage, and is getting it ready to house manufacturing.

“We’ll gradually move things over to that building, and hopefully we’ll have some manufacturing there by June 1,” said Scott Rozanas, vice president of finance and administration.

Although the office space is dated, the building suits the company’s purposes.

“The interior is set up real well for manufacturing, the infrastructure is there, and it’s close to our other building,” Rozanas said. “Economics required that we get an existing building, and we were very fortunate to get this one, because it’s hard to find space like this.”

The company was founded in 2010 by Peter Spellar and Ed Schinner, both Johnson Controls retirees, who still head up operations from Maryland. SGS started as consultants for other industrial refrigeration makers, but in 2013, the company entered the manufacturing side of the business through an acquisition.

A chain of events involving several companies led SGS to set up manufacturing in Dixon. Johnson Controls announced it would close operations in Dixon in 2009, costing the city more than 200 jobs. The IMECO industrial refrigeration line was among the brands made at the closing plant.

“Investors had tried unsuccessfully to acquire IMECO, and that presented a $50 million market opportunity with them gone,” Schmidt said. “SGS was really born from Johnson Controls.”

A private equity firm bought Krack parent company Hussman Corp. from Ingersoll Rand, and a Hussman business became available.

In March 2013, SGS announced it would buy Krack’s industrial refrigeration business from Hussman. Krack had been doing the manufacturing in Monterrey, Mexico, and SGS wanted to bring that work back to the U.S.

“Ed and Peter really wanted to bring the jobs back from Mexico,” Rozanas said. “Quality was the biggest reason, but there were also freight issues, and the Midwest has a lot of the distribution warehousing for grocery stores.”

The company’s prior links to Dixon conspired to bring SGS to town.

“Ed had been in IMECO management from 2000 to 2006, and he had developed a strong friendship with Jim Burke,” Schmidt said.

Schmidt first met the SGS owners in summer 2010 through the former Dixon mayor.

“There were so many ties to Dixon, and there were workers here who had a lot of the job skills that fit the business,” Schmidt said.

Schmidt also has an IMECO history, working there for 29 years before the facility closed. He then started R.C. Schmidt Industrial LLC in 2009, and in 2013, he also sold his business to SGS.

SGS REFRIGERATION MILESTONES

2010 – SGS Refrigeration is founded in Maryland by Peter Spellar and Ed Schinner.

March 2013 – Enters manufacturing end of business by acquiring Krack Industrial Refrigeration business from Hussman Corp.

July 2013 – Acquires R.C. Schmidt Industrial LLC.

Fall 2013 – Begins full-scale production in Dixon.

January 2016 – Finalizes purchase of building at 1100 Anchor Road in Dixon.