Regional Report Eastern February 2011
New owner will reinforce Xe
For more than two years, Moyock-based Xe Services Inc. has been rattling government officials and economic developers in northeastern North Carolina. In late 2008, it sacked 52 workers and closed a newly built plant after it failed to land a key government contract. In March, it sold its 225-employee aviation division, and, in December, the new owner announced that the division would move to Florida. A week later, a New York-based holding company bought Xe, formerly Blackwater USA.
But contrary to speculation that the company was heading down the drain, it appears Xe’s new owners might beef up operations not only in its home county, Currituck, but also in neighboring Camden. USTC Holdings LLC “plans to invest further in the company primarily on the training side,” says a spokeswoman who asked not to be named — Xe is no less secretive than Blackwater (Cover story, June 2007). Such a shift could distance Xe from the volatile private-security business that plunged it into hot water in Iraq and elsewhere. A federal judge in 2009 dismissed manslaughter charges against six employees in connection with the deaths of 17 Iraqi civilians in 2007, but a wrongful-death lawsuit is still pending.
Though controversial on the international scene, Xe is a valued corporate citizen in the job-hungry northeast. “They’ve been our largest taxpayer and employer for years,” says Camden County Manager Randell Woodruff, who also serves as economic-development director. “We’re a rural county, and mainly a farming area. We work closely with them.”
Local officials are scrambling to cement relations with the new owners, two Manhattan private-equity firms that joined forces for the sole purpose of buying Xe. “We want to let them know we’ll do everything we can to keep them strong,” says Peter Bishop, economic-development director in Currituck County. A company spokeswoman declined to say how many Xe employs. “I think it was up to about 1,200 at one time,” Bishop says. Now the number is about 600, he says, after the loss of the aviation division.
Currituck and Camden have other interests in Xe’s health. Its 70,000-square-foot industrial building where armored vehicles were to be assembled remains vacant. And the departure of Xe’s aviation arm could leave the company’s 5,200-foot runway and new hangar lightly used. Camden doesn’t have a local airport, important for economic recruiting, though striking a deal with Xe could be touchy. “What makes their compound so attractive to them is that it is so private,” Bishop says. ”But we want to let them know we will work with them. We’re coming in with open arms.”