Co-operative Meriasennus is an employee owned company specialising in electrical installation work in ship yards. It is based in Huittinen, which is situated inland but equally distant from all Finnish shipyards. Over half of the owners come from the Satakunta region which is the other reason for the base.
In spring of 1998 RL Sähkö-Marine Ltd went into liquidation and the men knew that there was no work after the summer holidays. Also their pay was in arrears and would be paid by the state under the Pay Security Act.
The employees set up Meriasennus which is now a successful employee owned business. This case study identifies how it was achieved.
Pekka Savolainen, who’d been a job coster in Sähkö-Marine, contacted the economic development agent in his home town Huittinen. The agent had just received mailing from the EBO project and put Pekka in contact with us.
Pekka Savolainen and Ilkka Alasippola (now managing director in Meriasennus) negotiated also with the owner of Sähkö-Marine and his soon to be partners about forming a new company. The employees decided not to work for him and his plan fell through.
That left the forming of an employee owned company as the only option in keeping the highly skilled and very cooperative workforce together.
On Monday five men out of a workforce of 24 met at the Entrepreneurship through Employee Ownership project offices in Pori to discuss their options in forming their own company.
One of the main objectives was to ensure the good relations the workforce had with Kvaerner Masa Yards, their largest potential customer. Masa Yards promised their support for the newly formed employee owned company if the owner of the previous company was not in any way connected to the new company.
The Masa Yards was pressing the workforce to act immediately because the luxury cruiser Paradise’s delivery date was near and they needed Meriasennus to finish the electrical installations.
Another objective was to ensure that the company should stay employee owned but could be flexible when somebody would want to leave or join the company. This was achieved by forming a workers cooperative under the Finnish co-operative act. On the advise of the projects development worker they decided that this was the way go.
Although the objective was to form a company of over 20 electricians, only five formed the cooperative Meriasennus. Immediately after the forming the cooperatives’ membership grew to 23 members as planned. Only one electrician decided not to join and to retire instead.
Meriasennus negotiated with the receivers of Sähkö-Marine and bought some equipment.
The raising of the finance
Even though the business plan was not ready, we started planning finance. This was extremely easy task when everybody was willing to invest about £2,300. The capital of almost £54,000 was sufficient to start the business.
- Ilkka Alasippola, today the Managing Director of Meriasennus;
- Pekka Savolainen, today Contracts Manager of Meriasennus;
- Jari Tuominen, today Chairman of the Board;
- and Kalevi Lievonen, Hannu Lampinen, Erkki Savolainen, Jarmo Valli, Matti Österman, who formed the unofficial buy out team.
Erkki K Kangas, development worker of the “Entrepreneurship through Employee Ownership” project. The project is funded by ESF ADAPT Community Initiative.
After the conversion
Since 10 July 1998 Meriasennus have traded as an employee owned company. Two weeks after formation all 23 workers were busy building Finnish luxury cruisers and other ships at the Kvaerner Masa Yards.
In the near future they’ll have less work because the ships will be delivered to customers but they have already won contracts for almost £200,000 for next year. The Finnish ship yards have their order books filled with orders for luxury cruisers and other vessels. Because of this, the future of Meriasennus looks very promising for the next few years.
Development worker Erkki K Kangas says that the most difficult part was the limited time (one week) available for the work. The reason for this was Masa Yards pressing need for continuation of the quality work the workforce were known to deliver. And that was not so difficult when the workforce was so determined to form their own company and chose the cooperative format he knew well.