When Coeur Mining, which mines silver and gold, began prospecting for a new corporate location in 2012, the choice was between sixteen cities across the United States.
Founded in 1928, the company had long outgrown its Northern Idaho home. What had begun as a regional company in the silver-rich area had grown into a New York Stock Exchange-traded company with gold and silver mines in Mexico and South America, in addition to other parts of the United States. “We were a very big company to be based in a small town in Idaho,” says Casey Nault, senior vice president, general counsel, and secretary of Coeur.
One of the reasons the company decided to move, and a major factor that played into its search, was a desire for greater visibility in the market. Ensconced in rural Idaho, if company executives wanted to see investors or analysts, they would often need to travel. Doing so was a logistical headache because they weren’t near a major airport.
Additionally, it was difficult for the company to attract employment candidates willing to relocate to a small town. The company felt that moving to a major city would give them access to a larger and stronger talent pool.
Working with a consultant who created an algorithm based on the company’s priorities, the company soon whittled down the list of cities to four: Dallas, Texas; Chicago, Illinois; Phoenix, Arizona; and Denver, Colorado—all of which hoped to draw the company with tax incentives.
Eventually, it came down to Dallas and Chicago, and the Windy City won out.
Silver and Gold
Coeur exclusively produces silver and gold; it is the largest US-based producer of silver, for which it is primarily known. The metals are sold from the refineries to banks and trading houses all over the world. Gold has few industrial applications and is mostly an investment commodity.
“It was a bit of an objective tossup between Dallas and Chicago,” Nault admits. “But on a subjective basis, we chose Chicago because it was closer to our stakeholders in Toronto, which is a major hub for precious metals mining in North America, and we felt it would be advantageous to be close to our investor centers there and in the Northeast. We also thought it would be good to be the only precious metals mining company based in our home city. And those of us involved in the decision had a strong affinity for the city, as well. At the end of the day, Chicago more than checked all of our boxes.”
As the company began to prepare for the move in 2013, setting up a temporary office downtown and scouting about for permanent space, a relocation company came to Idaho and made presentations about Chicago neighborhoods, schools, and lifestyles. Armed with the information, employees were given three months to decide whether they wanted to make the move or not. If they went along, they would receive relocation assistance. If they declined, they received a healthy severance package. If the employee decided not to relocate, he or she still had six more months on the job before receiving the severance, providing a long lead time to find another opportunity.
For many of the employees who had grown up in the area, the idea of leaving the open spaces, pristine air, and laid-back lifestyle of Northern Idaho for the tumult of a major city was unthinkable. For others who may have felt trapped in small-town life, it was like winning the lottery. It was a tricky time, says Nault. “The risks of the move were greatest on the people side,” he says. “We knew that even though we were offering a generous severance and long lead time, marketable people could go get something else quickly, and we could see key people leave in groups and much sooner than we wanted.” The company prepared itself for that possibility by contracting with temporary employment agencies and asking people to be ready to cover other employees’ responsibilities.
Though only one-third of Idaho employees decided to make the move, Nault says not many of the contingency plans had to be activated, as the transition played out in a manageable way. Still, the move left a lot of positions to fill—about half of the executive team opted not to move to Chicago.
“It created an opportunity for us to really go out and get the best people for each position that we could.”
At the temporary headquarters in Chicago, the recruiting process was a quick one. The company went after candidates not only in Chicago, but in cities like New York, Denver, Toronto, Ontario, and Salt Lake City. “It was an exciting time,” recalls Nault. “There were a lot of people we were hoping not to leave behind, but they made that choice on their own. It created an opportunity for us to really go out and get the best people for each position that we could.”
As all of the hires were made and people began arriving in Chicago, the company settled on an office in the historic Monroe Building on Michigan Avenue and Monroe Street, Chicago’s downtown. Nault says the restored building’s charm as well as the views it offers of Millennium Park and Lake Michigan—something that would appeal to Idaho natives accustomed to open sky—were key in making the decision.
As the company settled into its new home, the commodities business plummeted. Silver prices in particular fell below the cost of production for many companies, including Coeur, says Nault. Gold and silver prices saw a rise in 2016, but it’s difficult to predict whether that will continue.
Even so, Nault says Coeur’s decision to move wouldn’t have changed. “We viewed it as a very important, even critical, strategic move for the company, and so it’s probably something we would have done even if we knew that prices would deteriorate as they did,” Nault says. “Of course, it does get to a point where when you’re burning cash and losing money, anything that’s discretionary would be deferred. Luckily, the environment at the time we made the decision was still strong, and we were able to do it.”