By Seth Daniel
The chief executive of Necco Candy company said this week that the company is experiencing growth and will continue operating in its location on American Legion Highway – one week after it was announced that the plant had been sold of to two Boston developers.
CEO Michael McGee told the Journal on Tuesday morning that they have been a tenant for some years and will continue to be a tenant – but just for a new landlord.
“We’ve been a tenant at our 135 American Legion Highway plant since 2007 and we’re still a tenant,” he said. “We have a new landlord. Necco Real Estate received a very good value for the property.”
Last week, Atlantic Management of Framingham and VMD Companies of North Andover closed on the property, purchasing it from Necco Real Estate for $54.6 million.
The new owners have signed a lease with Necco Candy through Aug. 1, 2018, and it is renewable, but the new owners said they intend to meet with Mayor Brian Arrigo to talk about future development opportunities.
McGee stressed that the lease is renewable.
“It is renewable, so…,” he said.
However, he said he could not elaborate on the future of the company in Revere beyond the lease. Because Necco is a privately held company, he could not speak publicly about such candy strategy.
Necco Candy is owned by American Capital of New York. Necco Real Estate was also owned by American Capital, until it sold to the two developers. The candy company was officially a tenant of a subsidiary of its parent company.
What McGee could say is that their candy brands are strong, and employment at the factory is steady over the last couple of years. He also said they are still doing quite a bit of manufacturing for other companies, known as contract manufacturing.
“We want to grow,” he said. “Our candy line is doing really well. If you talk about our traditional, iconic brands like the Necco Wafer, they are doing incredibly well in the marketplace. We have double digit growth; feeling really good about that…I think you’re seeing a little bit of resurgence in what some might call the nostalgia candy.”
He said one major coup was expanding the distribution and refining the packaging, and getting the product into Wal-Mart. They are also venturing out to begin introducing sour wafers, part of the new flavor trend profile of popular sour candy.
McGee took over the reins from former CEO Al Gulachenski in late 2014, which was news to many in Revere last week when the sale of the plant became known.
The Journal spoke to Gulachenski last week, who said he left the company in late 2014. He said he was very proud of the work he did there and would have loved to stay on to continue reviving the brand and the workforce, but American Capital had different ideas. So, he said, they parted ways.
He said he did not run the company into the ground, nor did his revival of the brand starting in 2012 not work. On the contrary, he defended his work there and said things were moving really well when he left.
According to McGee, things are still working well.
He said they plan to continue manufacturing their candies and growing their brand in Revere.
“We certainly are very proud of the history of our business and the history of the brand,” he said.
Before Necco, McGee served as the vice president of Marketing at Mars Chocolate. Prior to Mars, he held key management positions at Kraft Foods working with leading brands such as Jell-O, Maxwell House and Post Cereal.