THE HISTORY OF SMITH VALVE CORPORATION

James Dewolf Smith founded Smith Valve in the early 1950's. The opening product lines consisted forged gate, globe and check valves. These products were primarily used in the petrochemical industries. In the mid 60's, James decided to add a complimentary forged brass ball valve line to the production stream. 

By the middle of the 1970's, Smith Valve was one of the largest producers of industrial gate, globe, check, and ball valves under the 2.5" size. In fact, Smith was producing about 100,000 pieces per week and booking orders with even greater speed. The valve business was booming and the oil producers were consuming Smith products at an incredible rate. James' business became his son's business. Tony Smith was expanding the company with the incredible momentum and the Smith family was adding exotic stainless and alloy items to their product offering. Their small diameter valve business required a ton of capital for machine tools and millions of dollars for inventory, not to mention that they had grown out of their production complex. In the early 80's, the Smith family relocated the production into a brand new 250,000 square foot manufacturing facility in Westborough, Massachusetts. Here they employed about 700 people and produced about 70 million dollars per year in forged steel, alloy steel and brass valves. 

By the mid 1980's, the bottom had fallen out of the oil business and the producers had basically shut down their production facilities. This dramatic downturn in market conditions and a rapid increase in foreign competition lead Smith to their first of many lay offs. As difficult times persisted, Tony was forced to make more dramatic moves. An effort was made to move 80 percent of the commodity manufacturing offshore. Plants were opened in Singapore and in Hong Kong to effectively reduce production cost and compete with other foreign manufactures. Tony switched market focus and began to private label ball valves for WABCO and KNORR as well as other customers. He licensed his industrial ball valve line to raise cash for his core business. 

By 1993, the company was in such difficult times that Tony decided to sell the business to an investment firm called Cornerstone Financial. This transaction was fraught with trouble from the beginning. The investment firm assumed $10 million in debt carved out and sold the true assets as separate product lines to book a couple of million in profit. Only one problem-the bank believed the sale to be improper as they were not notified of the sale, and decided to call the note. The investment firm could not muster the $10 million and filed for chapter 11. The company struggled on for about two years and continued selling assets to pay the bank. During this time, both the Singapore and Hong Kong facilities were either sold or closed, and the brass ball valve line was sold to WABCO.