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Global Consolidation

Global ConsolidationWhat in the world are European investors doing in the U.S. material handling arena? A lot. The United States is generally considered to be the birthplace for new technology that arrives overseas at a later date. Netherlands based Pon Holdings B.V. believes that “timely knowledge of such developments could mean a competitive advantage for its companies in other parts of the world.” Beginning in the early 1990s, the five companies on the following pages have been acquiring U.S. material handling companies. With E-commerce generating a huge boom in warehouse space and the required logistics systems, investors are ready and willing to cash in on this aspect of the exponential growth caused by the Internet. In their search for new technology, European investors have found the value of this market and the euro’s place in it (“European Investors Making Presence Felt“). They’ve also learned that material handling, in all its forms, is a critical component of today’s commerce. To an investor with a lot of money to spend, this is good news.


 

BT Industries AB*Sweden
Headquarters: Stockholm, Sweden

Products: Manufactures lift trucks and related material handling equipment; provides full range of services, including rental and training.

Markets: Products and services marketed in some 60 countries worldwide

Employees: 7,000

Total sales (1999): Over $1 billion (U.S. dollars)

Divisions:
BT EUROPE for the West European market;
BT RAYMOND for the North American market; and
BT INTERNATIONAL for all other regions.

Material Handling Acquisitions in the U.S.
The Raymond Corporation (Greene, NY)
The Raymond Corporation supplies equipment used in the transportation, storage and selection of products in manufacturing, warehousing and shipping applications. The company sells products under its Raymond and Dockstocker brands and produces OEM equipment for sale under a variety of brand names. BT RAYMOND has responsibility for BT’s activities in the United States, Canada and Mexico.

Prime-Mover (Muscatine, IA)

Strategic Plan**

1. Broader product range to new and existing customer segments as well as additional markets.
2. Stronger coverage in mature markets in Europe and North America, in part through complementary distribution channels.
3. Further expansion of product and service distribution in markets in Eastern Europe, Asia and South America.
4. Coordination of production resources, primarily in North America, and faster flows in production and distribution to manage capital more efficiently.
5. Measures for improving cost efficiency include shared group development of products for global distribution and the reduction of distribution expenses.

* As of May 2000, BT Industries was considering an acquisition offer from Toyoda Automatic Loom Works, Ltd., a manufacturer based in Kariya, Japan.

**Source: 1999 Annual Report


 

FKI plcUnited Kingdom
Headquarters:
Halifax, United Kingdom

Products: Products and services in the areas of material handling (including lifting products, conveyors and compaction equipment), hardware (including retail hardware, ergonomic equipment and casters), and engineering (including electrical engineering and measurement and control).

Markets: NA

Employees: 15,147

Total sales (1999): $1.8 billion (U.S. dollars)

Divisions:
The group operates through three divisions: Hardware, Engineering and Material Handling.

Material Handling Acquisitions in the U.S.
Pinnacle Automation, Inc. (St. Louis, MO)
Pinnacle Automation produces automated material handling systems, including palletizers, conveyors, pick-to-light software, carousels, and software and controls. The Pinnacle Automation group includes Alvey Systems, Inc. (St. Louis, MO); The Buschman Company (Cincinnati, OH); Real Time Solutions, Inc. (Emeryville, CA); and White Systems, Inc. (Kenilworth, NJ).

SNE Systems (Louisville, KY)
SNE Systems is a software control systems integrator for the material handling industry. Specializes in designing and implementing control systems for high-speed sortation equipment.

Mathews Conveyor (Danville, KY)
Mathews designs and manufactures complete material handling systems that integrate conveyors, sorters, controls and custom equipment.

Industry General Corporation (Memphis, TN)
IGC specializes in the design, build and installation of material handling systems for the overnight parcels and packages industry.

Strategic Plan*

1. Develop areas that combine competitive products with large market shares.
2. Seek acquisitions complementary to existing activities that will promote growth and can be funded from the company’s own cash resources.
3. Step up investment in new technologies and products.
4. Focus on logistic systems to meet increased demand arising from E-commerce.

*Source: 1999 Annual Report

Pon Holdings B.V.Netherlands
Headquarters: Nijkerk, Netherlands

Products: Pon Holdings is an international distribution group of over 60 companies operating in eight main product groups: cars and commercial vehicles; dealers; automotive products; material handling equipment; trucks, engines and agricultural equipment; financial services; industrial products and telecommunications.

Markets: Pon operates primarily in the Netherlands, but has begun to establish an international presence. In addition to the United States, Pon is also active in Belgium, France, Italy, Norway, Scotland, Switzerland, Poland, United Arab Emirates, Thailand and Singapore.

Employees: 3,500

Total sales (1998): $3 billion (U.S. dollars)

Divisions:
Business groups include: Auto Import Group; Pon Dealer Group; Continental Tire Group; Material Handling Equipment; Trucks, Engines and Agricultural Equipment; Financial Services; Industrial Products and Telecommunications.

Material Handling Acquisitions in the U.S.
Material Handling Services, Inc. (Carol Stream, IL)
Distributor of Clark and Daewoo forklift trucks, as well as a range of storage and handling products. Acquired by Pon North America in November 1999.

LeveeLift, Inc. (Evansville, IN)
Distributor of Caterpillar, Nissan, Taylor, Barrett, Trackmobile, JLG and Marklift product lines. Acquired by Pon North America in January 2000.

Strategic Plan*

1. Solidify business groups established as part of Pon’s efforts to diversify beyond car and commercial vehicle activities.
2. Optimize the market position, both nationally and internationally, of these groups, partly through well-chosen takeovers.
3. Maintain a strong decentralized organization to facilitate rapid decision making.
4. Allow a large degree of independence in managing the operating companies.
5. Maintain a healthy capital asset ratio.
6. Employ stringent financial criteria in the development of new activities and takeovers.

*Source: 1998 Annual Report

Germany

Siemens AG
Headquarters:
Munich/Berlin, Germany

Products: 50,000 product families and over 1 million products in a broad range of areas.

Markets: NA

Employees: 443,000

Total sales (1999): $62.2 billion (U.S. dollars)

Divisions:
Main business groups include: Energy, Industry, Information and Communications, Transportation, Health Care, Lighting and Components

Material Handling Acquisitions in the U.S.*
Rapistan Systems (Grand Rapids, MI)
Rapistan Systems provides material handling solutions ranging from conveyor modules to large scale integrated systems to customers worldwide.

Strategic Plan**

1. Gain and hold top positions in world markets through strategic acquisitions and partnerships with other companies, spinning off businesses and shutting down weak performers.
2. Development of comprehensive, company-wide benchmarking, asset management and quality improvement.
3. List Siemens in New York in fiscal 2001; stay on schedule to achieve the scope and transparency in financial reporting required under GAAP in the United States.
4. Use gains from divestments to strengthen businesses in areas such as mobile communications, Internet-oriented products and process automation.
5. Employ E-commerce to systematically integrate customers and suppliers into the company’s operations.

*Rapistan was acquired by Germany’s Mannesmann AG in 1992, forming part of the company’s Mannesmann Dematic division. In September 1999, Mannesmann initiated plans to create a separate company from its engineering and automotive divisions. The new entity, Atecs Mannesmann, encompassed the Dematic, Rexroth, Sachs, Demag Krauss-Maffei and VDO divisions of the company. In April 2000, Mannesmann’s supervisory board approved the sale of Atecs Mannesmann, including Rapistan Systems, to a consortium of Siemens AG and Stuttgart-based Robert Bosch GmbH.

**Source: 1999 Annual Report

Switzerland

Swisslog AG
Headquarters: Buchs/Aarau, Switzerland

Products: Automated material handling consulting, system design and software

Markets: The company sells its products in 50 countries.

Employees: 3,500

Total sales (1999): $450 million (U.S. dollars)

Divisions: Companies belonging to the Swisslog group include Munck, Digitron, Accalon, Schierholz, Cimcorp, Swisslog Software, Translogic, Translift and Transnorm Systems.

Material Handling Acquisitions in the U.S.
Munck Automation Technology, Inc. (Newport News, VA)
Manufacturer and systems integrator of AS/RS and AGVS in North and South America.

Translogic Corporation (Denver, CO)
Installer of computerized pneumatic tube systems as well as other material handling systems in businesses throughout North, Central and South America and the Far East. Acquired as part of the Thyssen Krupp Industries Light Conveyor Systems Group.

Sonica Software Corporation (Orange, CA)
Provider of Oracle-based warehouse management and E-commerce fulfillment systems for the Microsoft Windows NT, UNIX, Sun/Solaris and Linux markets.

Strategic Plan*
1. Expand presence in global logistics systems markets.
2. Develop customer proximity, a comprehensive range of services and a broad geographic base.
3. Growth financed through internally generated funds.

*Source: 1999 Annual Report

Material Handling Equipment Distributors Association

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