Modern Drop Forge Relocating to Indiana

Aug. 24, 2011
New plant will be built, to start up in 2014

Modern Drop Forge Co. will relocate its Chicago-area plant to Merrillville, IN, by 2014. The company, a subsidiary of Modern Forge Cos. LLC, has been operating in Blue Island, IL, for nearly 100 years, but the group’s owner Greg Heim credited Indiana’s “common sense approach to business” in contrast to the “poor business environment in Illinois,” for the decision to move the plant. He listed Illinois’ worker’s compensation laws and taxes as examples.

As incentive to Modern Forge, the Indiana Economic Development Corp. is making available up to $2,000,000 in performance-based tax credits and up to $200,000 in training grants, based on the company's job creation plans.

Also, the city of Merrillville approved property-tax abatement for the new operation, and the Northwest Indiana Regional Development Authority offered other assistance.

Indiana governor Mitch Daniels announced the move, including the forecast that the Merrillville plant will create up to 240 jobs in the state.

Illinois officials contended their state and the city of Blue Island also offered incentives to the company in order to keep the operation.

Modern Forge will invest $17 million to acquire and update a 150,000-ft2 building in Merrillville, and it will build a new, 60,000-ft2 forging shop on the site. The new plant will house eight forging production lines, engineering offices, a die shop, and general business offices. Once the Merrillville plant is up and running, the Illinois plant will close.

The value of the capital investment for the new plant was not announced.

Modern Drop Forge produces closed-die forgings for automotive, aerospace, and railroad customers. The holding company has over 700 employees and 35 forging and machining lines in production nationwide. It reported 2010 revenues over $100 million.

Other operations in the group are Modern Forge Tennessee, Piney Flats, TN; Modern Forge Texas, Hurst, TX; Heim Manufacturing Corp., Sussex, WI, a contract machining plant; and Mid-States Production Machining in Rockford, IL, a horizontal machining center.

"The IEDC and city of Merrillville people have been very easy to work with,” Greg Heim said at the announcement. “Indiana has and continues to create a positive business environment for manufacturers such as Modern. As a third-generation business owner, the common sense approach to business makes Indiana a top choice for manufacturers. Modern looks forward to serving our many customers out of our new plant in Indiana over the companies next 100 years."