First Data Corp. plans to hire up to 1,000 new workers in Atlanta over the next three years, Georgia Gov. Sonny Perdue announced earlier this week.
Colorado officials, in contrast, are hoping those hires don’t come out of the 1,500 jobs the electronic-payment processor still has in Greenwood Village.
“We want to hold on to as many jobs as we can,” said John Lay, president and chief executive of the Southeast Business Partnership.
Last week, First Data, the state’s largest private company, announced it would relocate global headquarters from Greenwood Village to Atlanta.
Four months ago, a First Data executive tipped off Tom Clark, executive vice president of the Metro Denver Economic Development Corp., that the company was working on a plan to consolidate operations.
Top management would be split between Atlanta and Denver under a barbell scenario, Clark said.
The actual announcement, buried in a second-quarter earnings release Aug. 14, came before local officials could make a formal counteroffer to keep the headquarters.
“It was an accomplished fact. The change was being made,” Lay said.
Atlanta’s convenience cited
First Data wanted to bring a dispersed management team, including recently hired executives living elsewhere, into one place.
Several large customers were based in Atlanta, as was a new and significant joint venture the company formed with Bank of America earlier this summer. The convenience of Atlanta’s airport to East Coast and European markets also weighed in the decision, Clark said.
“Atlanta allowed us to consolidate operations, be closer to our customers, and continue to recruit from a great talent pool,” Michael Capellas, First Data CEO and chairman, said in a statement.
Eight years ago, the tables were turned. Incoming CEO Charlie Fote moved the company’s headquarters to Colorado from Atlanta, citing the region’s quality of life.
Fote believed workers would be happier in Colorado, and thus easier to recruit and more productive, Clark said.
But Fote’s departure in 2006 started a chain of events that led to the headquarters’ eventual return to Atlanta.
Fote’s mentor, Ric Duques, came out of retirement to arrange for the spinoff of Western Union, a money-transfer subsidiary, and the eventual sale of First Data to Kohlberg Kravis Roberts for $29 billion.
KKR saddled First Data with $22 billion in debt from the leveraged buyout. That heavy debt, combined with a slumping economy, intensified pressures to cut costs and consolidate.
Unlike Duques, Capellas, a nationally recognized CEO, established a residence in Colorado. He retained the company’s sports-stadium boxes and relocated product-development jobs to the state in late 2007, raising hopes that First Data was here to stay.
But employment levels, which were once around 2,000, have fallen to 1,500 and now the top executives have moved out.
Lay and Clark said they reached out to Capellas, who happened to be a personal friend of Don Elliman, the state’s former economic-development director.
Capellas keynoted the Southeast Business Partnership’s annual luncheon in May 2008.
But as the new CEO of a far-flung empire, he traveled frequently and kept a lower profile locally, at least compared with Fote.
Support for foundation cut
First Data also reduced financial and fundraising support from executives for the Latin American Education Foundation, which provides scholarships to students, said foundation executive director Jim Chavez.
Fote had served on the South Metro Denver Chamber of Commerce board and on committees that raised funds for the foundation.
First Data’s local sponsorships and grants did rebound to $331,500 in 2008 from $120,000 in 2007, said spokeswoman Elizabeth Grice.
And Capellas has been involved locally. He joined the Leadership Council of the Boys and Girls Clubs of Metro Denver in 2008.
Two high-profile episodes may have also left First Data feeling less welcome here, although they weren’t a factor in the move.
One came in 2004, when former Congressman Tom Tancredo proposed taxing worker remittances to Mexico, directly harming Western Union, then a First Data subsidiary.
The other came last spring when Frontier Airlines blamed First Data for its bankruptcy filing, and loyal fliers of the hometown carrier spewed venom at the lesser-known First Data.
In an odd coincidence, a day after Republic Airways Holdings won its bid to take Frontier out of bankruptcy, First Data announced the headquarters would leave Denver.
Aldo Svaldi: 303-954-1410 or asvaldi@denverpost.com
From Georgia to Colorado … and back
Eight years ago, incoming First Data chief executive Charlie Fote, moved the company’s headquarters to Colorado from Atlanta, citing the region’s quality of life. But Fote’s departure in 2006 started a chain of events that led to the headquarters’ return to Atlanta.
Last week, First Data announced it was relocating global headquarters from Greenwood Village to Atlanta in order to consolidate operations and be closer to several large customers, according to Michael Capellas, First Data CEO and chairman.
