Merit Medical's $25M Utah Expansion Could Add 500 Jobs, Site Selection Online Insider

Chairman and Chief Executive Fred Lampropoulos (pictured), who's weighing a Utah gubernatorial run, said that the Utah expansion is "our next step for our growth, allowing for better efficiency and utilization of space."

SOUTH JORDAN, Utah – Merit Medical Systems (www.merit.com) has come a long way, baby, since the ideas for the company were first sketched out on a napkin inside a Wendy's fast-food outlet in Utah:
Continuing its napkins-to-riches rise, the disposable medical products manufacturer is adding as many as 500 jobs - which would almost double its total work force - in a 180,000-sq.-ft. (16,200-sq.-m.) expansion in South Jordan, Utah. And Merit Medical is now so financially robust that it's planning to fund the $25-million project out of projected cash flow.
"This is the next step for our growth, allowing for better efficiency and utilization of space," said Chairman and Chief Executive Fred Lampropoulos, It was Lampropoulos, along with Merit Medical CFO Kent Stanger, who sat down in 1987 and jotted down the concepts that spurred the creation of a company that's now riding a strong upsurge.
"This new facility will add 300 to 500 new jobs here in Utah over the next few years as we grow into the space," Lampropoulos said at the expansion groundbreaking at the 32-acre (13-hectare) site that's the company's primary manufacturing location.

The Utah expansion will also include an operation producing sensors (pictured), which "will become the fastest-growing part of our business," Merit Medical's chairman predicted.

The project, which will involve building two new facilities, will double the amount of manufacturing space at the location in the Salt Lake City metro. (For a look at other expansion action in the metro area, see the accompanying sidebar, "Expansion Spiraling Upward in Salt Lake City.")

Sensor Fab Will Also
Move into New Space

Merit Medical began its existence with a single product, a specialized control syringe used to inject contrast solution into patients' arteries for angiograms. Today, the company makes more than 2,000 proprietary medical devices, most of them used in cardiology and radiology procedures.
The Utah expansion will primarily add injection-molding and electronics manufacturing. Lampropoulos said that $20 million of the company's projected capital investment would go into construction, with another $5 million going into equipment.
The added space will also house a sensor-fabrication facility, which Merit Medical will relocate from its current location in Santa Clara, Calif. The 25-employee Santa Clara facility is part of subsidiary Merit Sensor Systems, which makes pressure sensors that are used in high-volume medical instrumentation.
Sensor production "will become the fastest-growing part of our business," Lampropoulos projected. All of the California workers are being offered transfers, he added.
Merit Medical will also use the new space to consolidate some 150 employees who're now working in the nearby city of Murray. The consolidation will cut costs, as well as strengthening the linkages between development, production, distribution and delivery, said Lampropoulos.
The expansion should be completed by December 2004, he added.

No. 43 on Forbes 'Best
Small Companies in America'

The Utah expansion underscores Merit Medical's deep roots in the Beehive State. The company has its headquarters complex at another location in South Jordan, and 900 of its 1,200 total employees are in Utah.
Merit Medical has other manufacturing facilities in Angleton, Texas; Galway, Ireland; and Salt Lake City. The company is currently adding a 40,000-sq.-ft. (3,600-sq.-m.) expansion at its Irish plant to increase R&D and production space.

Business Incubator? The ideas for what became Merit Medical were sketched out on a napkin inside a Wendy's restaurant like this one.

The company's $116.2 million in revenues in fiscal 2002 marked an 11.7-percent increase. "We will be able to pay for this [project] out of our existing cash flow," Lampropoulos said of the Utah expansion.
Merit Medical's strong growth recently landed it for the third year in a row on Forbes' listing of "The 200 Best Small Companies in America." The Utah firm ranked No. 43 in the magazine's 2003 hierarchy, a move up of 10 spots from its 2002 slot. Forbes' rankings of more than 3,500 small companies with 12-month sales of between $5 million and $600 million are based on sales growth, earnings and return on equity.

Co-founder Lampropoulos has also seen his fortunes spiral upward. Now a multimillionaire, the Merit Medical chairman and chief executive is now mulling over making a run for the Republican nomination for the Utah governor's race.
President George Bush (R) in August tapped Utah's Republican Gov. Mike Leavitt to head the Environmental Protection Agency. In November, Olene S. Walker, Leavitt's lieutenant governor, was sworn in as Utah's 15th governor, the first woman to hold the post.

Expansion Spiraling Upward in Salt Lake City

By ADAM BRUNS, Site Selection Managing Editor

Stretching out for 1,500 feet (455 meters) into the waters of the Great Salt Lake, the Spiral Jetty (pictured at a distance and in a close-up detail) is one of the world's most ambitious pieces of earth art.
SALT LAKE CITY – A famous work of earth art, the Spiral Jetty created by artist Robert Smithson (see accompanying photos), sometimes resurfaces after years of obscurity in the waters of the Great Salt Lake. It all depends on slight changes in elevation.
In nearby Salt Lake City, the industrial real estate marketplace is peeking above the surface too, with lease rates rising and sale prices coming back on all but the smallest properties.
Big sell-offs by Fleming Foods and Southwire Corp. brought 871,000 sq. ft. (80,916 sq. m.) of space to the market, but that was offset by 750,000 sq. ft. (69,675 sq. m.) of new space in 11 industrial facilities being built during the first half of 2003, according to Colliers Commerce CRG.
Recent corporate arrivals in the Salt Lake City metro include the final personnel move by meatless food product company Gardenburger from its hometown of Portland, Ore., to Clearfield, Utah. In 1999, the company moved its manufacturing to Clearfield. Once all functions were moved in October 2003, approximately 167 people were employed at Gardenburger's Utah facilities. More recently, Salt Lake City-area expansions have included:
• Wisconsin-based Schreiber Foods is building a 90-employee, 35,000-sq.-ft. (3,150-sq.-m.) West Coast cheese distribution center in Logan that will open next summer.
• Qwest Communications has begun hiring for the new 155-employee digital subscriber line support center that it's opening in Salt Lake City, adding to the 3,000 people that the company already employs in Utah's largest metro.
• Demonstrating what it called its "irrevocable commitment" to Salt Lake City, The Church of Jesus Christ of Latter-day Saints announced that it will construct two new buildings in the city, one to accommodate an expanded Salt Lake Center of Brigham Young University, the other to house a new campus for LDS Business College. In addition, the church divulged plans to use "hundreds of millions" of business-generated funds to soon renovate and upgrade the city center malls and nearby properties.
Salt Lake City is also one of 18 Utah cities that are together trying to build the largest U.S. ultrahigh-speed digital network. The $470-million network has been dubbed UTOPIA - an acronym for Utah Telecommunication Open Infrastructure Authority.
UTOPIA would provide the 725,000 Utah residents within the network with Internet speeds that are 100 times faster than current commercial residential offerings. The envisioned network would also offer Internet-based digital television and phone services.