| Type | Public (NYSE: GRA) |
|---|---|
| Industry | Basic Materials |
| Founded | 1854 |
| Headquarters | Columbia, Maryland, U.S. |
| Key people | Alfred Festa, Chairman & CEO |
| Products | Specialty Chemicals |
| Employees | 6,500 |
| Website | www.grace.com |
W. R. Grace and Company (NYSE: GRA) is a Columbia, Maryland, United States based chemical conglomerate.
The company has two main divisions, Davison Chemicals and Performance Chemicals. The Davison unit makes chemical catalysts, refining catalysts, and silica-based products that let other companies make products from refined crude oil. Its Performance Chemicals unit makes cement and concrete additives, fireproofing chemicals, and packaging sealants. The customers include chemicals companies, construction firms, and oil refiners.[1]
Their self-description is "a premier specialty chemicals and materials company." Grace has more than 6,400 employees in nearly 40 countries, and annual sales of more than $2.5 billion.[1] The company's stock, with ticker symbol "GRA," listed in 1953, trades on the New York Stock Exchange.[2]
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The business that would become W. R. Grace and Company was founded in 1854 in Peru by William Russell Grace, who left Ireland due to the Potato Famine. He went first to Peru to work as a ship's chandler to the merchantmen harvesting guano (from bird droppings, a fertilizer and gunpowder ingredient due to its high levels of phosphorus and nitrogen). His brother, Michael joined the business there and they would form Grace Brothers & Co. The company set up head office operations in New York City in 1865. Working in fertilizer and machinery, the company was formally chartered in 1872, and incorporated in 1895.[3]
Michael and William Grace had a third brother, John W. Grace. For years he remained mostly out of the limelight running a business in San Francisco, California. However, with Michael based in London, England for half the year plus his extensive travelling to South America, when William developed health problems in the early 1890s it made it necessary for John to come to New York to help oversee operations. As part of estate and successor planning, in 1895 the three brothers consolidated most of their holdings into a new private company incorporated in West Virginia called W. R. Grace & Company. The consolidation involved W. R. Grace & Co. of New York, Grace Brothers & Co. of Lima, Peru, Grace & Co. of Valparaiso Chile, William R. Grace & Co. of London, and J. W. Grace & Co of San Francisco. The officers of the new company were:[4]
J. Louis Schaefer, who joined the company as a boy, would play a key role in not only W. R. Grace & Company in which he became a vice-president, but also as president of Grace National Bank. Schaefer would be a co-executor of the Estate of Michael Grace with William's son and corporate successor, Joseph P. Grace. J. Louis Schaefer died in 1927. [1]
On the death of William R. Grace in 1904, he was succeeded by William L. Sauders as company President followed by Joseph Peter Grace, Sr. (1872-1950) who became president in 1907. J. Peter Grace, Jr. took over management of the company after his father suffered a stroke in 1945.
In 1954, the company bought Davison Chemical Company (founded by William T. Davison as Davison, Kettlewell & Company in 1832), and the Dewey & Almy Chemical Company (founded in 1919 by Bradley Dewey and Charles Almy).
At one time, Grace's main business interest was in shipping. To get its products from Peru to North America and Europe, including guano and sugar, and noticing the need for other goods to be traded, William Grace founded a shipping division.[3]
The company bought a 53% stake in Miller Brewing in 1966, for $36 million; Lorraine Mulberger sold the stake for religious reasons.[5] It sold the Miller stake in 1969 to Philip Morris for $130 million, topping a deal with PepsiCo for $120 million.[6][7][8]
In 1987, with a can sealing plant in Shanghai, Grace became the first wholly foreign-owned company to do business in The People's Republic of China.
Grace's corporate headquarters are located in Columbia, Maryland. Although W. R. Grace commissioned the Grace Building in New York City, built in 1971, the company no longer has any offices occupying it.
The company has its headquarters in Columbia, an unincorporated census-designated place in Howard County, Maryland.[9][10]
Previously the company had its headquarters in unincorporated Palm Beach County, Florida, near Boca Raton.[11][12] Prior to its closing, the Boca Raton headquarters had about 130 employees. On January 27 it announced it was moving its administrative staff to the Columbia office and closing the Boca Raton headquarters. About 40 of the employees went to Columbia, and some employees went to Cambridge, Massachusetts.[11]
Subsidiaries and some of their products include:
W. R. Grace and Company has been involved in a number of controversial incidents of proven and alleged corporate crimes, including exposing workers and residents of an entire town to asbestos contamination in Libby[19] and Troy, Montana, water contamination (the basis of the book and film A Civil Action) in Woburn, Massachusetts, and an Acton, Massachusetts, Superfund site.
While Grace no longer makes asbestos-related products, W. R. Grace and Company has faced more than 270,000 asbestos-related lawsuits. 150,000 lawsuits have been settled or dismissed and 120,000 remain.[20]
After asbestos injury claims unexpectedly nearly doubled in 2000, W. R. Grace & Company filed for bankruptcy protection in 2001. The United States Department of Justice alleged that Grace had transferred 4 to 5 billion dollars to daughter companies that it had recently purchased, shortly before declaring bankruptcy. Justice Department attorneys alleged that this amounted to a fraudulent transfer of money in order to protect Grace from civil suits related to asbestos. The bankruptcy court ordered the companies to return nearly $1 billion to Grace, which will remain as part of the assets to consider in the bankruptcy hearings.
The company has a history of environmental crimes, which were summarized in the Seattle Post-Intelligencer on 18 November 1999, headlining "The History of W.R. Grace & Co." These crimes were the basis for the bestselling non-fiction book and popular motion picture, "A Civil Action," which concerned the pollution-destruction of neighborhoods in Massachusetts by W.R. Grace & Co.
In 2005, the U.S. Department of Justice began criminal proceedings against W.R. Grace. On February 7, 2005, the department announced that a grand jury in Montana indicted W.R. Grace and seven current and former Grace executives for knowingly endangering residents of Libby, Montana, and concealing information about the health effects of its asbestos mining operations. According to the indictment, W. R. Grace and its executives, as far back as the 1970s, attempted to conceal information about the adverse health effects of the company’s vermiculite mining operations and distribution of vermiculite in the Libby, Montana, community. The defendants are also accused of obstructing the government’s cleanup efforts and wire fraud. To date, according to the indictment, approximately 1,200 residents of Libby area have been identified as suffering from some kind of asbestos-related abnormality.[21]
The criminal trial began in February 2009 after years of pretrial proceedings which reached the United States Supreme Court.[22] By the time the trial was set to begin, one of the defendants, Alan Stringer, had died of cancer.
On Friday, May 8, 2009, W.R. Grace was acquitted of "knowingly" harming the people of Libby, Montana. Fred Festa, chairman, president and CEO said in a statement, "the company worked hard to keep the operations in compliance with the laws and standards of the day." David Uhlmann, a former top environmental crimes prosecutor has been quoted as saying about the W.R. Grace: "There's never been a case where so many people were sickened or killed by environmental crime." The W.R. Grace case has long festered in the court system on a 10-count indictment including charges of wire fraud and obstruction of justice. W.R. Grace has voluntarily paid millions of dollars in medical bills for 900 Libby residents.