In May 2014, Donald Baumgartner, chairman of the Milwaukee company Paper Machinery Corp., and his wife, Donna, traveled to Bhutan, a small country in the Himalayas consisting of about 750,000 people spread throughout mountain valleys just south of the Tibetan Plateau. Baumgartner had read that Bhutan was one of the happiest countries on earth, and he wanted to find out why.
Back in Milwaukee, PMC’s employees faced uncertainty. Their supreme leader, Baumgartner, was 83 years old and nearing the end of his long tenure at the helm of the enterprise he founded in 1951 and which went on to build machines that manufacture small paper cups. Baumgartner’s son, John, the current president of the family-held company, was nearing 65 and his own retirement, and he lacked a successor. If the Baumgartners sold the business, the new owner might relocate the plant and shutter the tall, air-conditioned facility on the Northwest Side, killing Wisconsin jobs and abandoning the colorful murals the elder Baumgartner had commissioned to brighten the mood on the shop floor.
In Bhutan, Donald and Donna Baumgartner stayed at the luxurious Amankora Resort, where a double occupancy can cost up to $1,800 a night, about three-quarters of the country’s per capita gross national income, some $2,300 a year. A majority-Buddhist country, Bhutan outlawed television until 1999 and imposes a dress code mandating vivid robes for both sexes, even as its economy has grown in recent years thanks to a massive buildout in hydroelectric dams.
Despite the small wealth of the average Bhutanese, Baumgartner saw the place as a kind of economic utopia. “There’s enough money to go around for everybody,” he says. Handsome, 36-year-old King Jigme plays a central role in the country’s life, negotiating electric power deals and stoking national confidence. “These people are smiling all the time,” Baumgartner says. “They all have penises hanging from their doors like door knockers. I think it’s a fertility symbol or something.”
This colorful vision of Bhutan long lingered in Baumgartner’s mind. He also pondered his father, who founded three businesses in Wisconsin and sold each to investors, costing Wisconsin workers their jobs. He awoke one morning after months of deliberation, “and the first words out of my mouth were, ‘ESOP.’”
Under an Employee Stock Ownership Plan (ESOP), their family would transfer ownership to PMC’s employees, who, upon retirement, could sell the shares back to the company at a large profit. An ESOP would make less money for the family than a traditional sale but make the company plant highly difficult to move.
On a recent May morning, Baumgartner sat behind his office’s wide, computer-free desk, dressed in white tennis shoes and striped track pants, the room suffused with a soft brown light. The walls were decorated with photos from his safari trips, and over his shoulder hung a tapestry of a tiger. “Originally, the shareholders were concerned,” he says, “to say the least.” But a work group chipped away at the details, and in early May, PMC hired a large tent, a band, and a videographer and allowed the suspense to build. “We have new owners,” Donald announced, “Drumroll please. And they’re you.”
As Baumgartner recalls the moment now, the employees “were jumping up and down and wild.” The reaction captured on video is more muted. The happiest person, right then, appeared to be Baumgartner himself, who smiled and covered his white hair with a hat that said, “PMC: An Employee-Owned Company.”
Sparking the ESOP isn’t Baumgartner’s only good deed as of late. He’s one of the top arts donors in town and gave $8 million to the Milwaukee Art Museum in mid-May. In late May, he rewarded himself by bringing home to his River Hills mansion a $1.1 million McLaren P1 supercar, which he uses to commute to PMC, where he’ll stay on as chairman of the board. On a recent plant tour, he said, “Look at these happy guys. Everybody’s smiling here. Pretty soon we’ll be painting penises on the wall.”