Global Fastener News

1989 FIN – Buell Will Sell Small Fastener Business to ITW But Stay In Fasteners

October 14
00:00 2010


October 1, 1989 FIN – Buell Industries, Waterbury, Connecticut, has agreed to sell the assets of its small screw and nut product lines located in Waterbury, Connecticut, to Illinois Tool Works (ITW), of Chicago, Illinois.
According to Vincent Largay, chairman, Buell, in order to satisfy customer requirements, will phase out the manufacturer of small screws and nuts over the next several months. Largay said that regrettably the sale would affect 175 out of 600 jobs at the Waterbury plant, but that Buell is providing severance benefits and counseling for job placement or retirement.
Largay emphasized that Buell is not leaving the fastener industry and will continue to manufacture the large sizes of fasteners at it’s Anchor Fastener operation in Bedford Heights, Ohio, which is unaffected by the sale. Also not affected are Buell’s other operations which include Bedford Wire, Bedford Heights, Ohio (a manufacturer of steel rod and wire), the Anchor Fasteners stamping plant, Waterbury, Connecticut; and the Highland Manufacturing Co., (a producer of deep drawn metal parts), also located in Waterbury.

For the ninth month period ending July31, 1989, Buell’s small fastener operations generated sales of about $15 million out of the company’s aggregate sales of about $66 million for that period.

According to Largay, Buell, which began manufacturing screws and nuts in 1951, concluded that the business could not be operated profitably because if increased operating costs, declining sales, the prospect of major pollution control expenditures, and little expectation of price relief in a very competitive market.

Largay’s explanation for the sale, incidentally, is pretty much in line with what some people had been guessing may take place as part of Buell’s reorganization plan. In our last issue, you’ll recall, financial analyst Ellen Horing, who follows the fastener industry for Gabelli & Co,. New York City was pretty sure that Buell’s reorganization would include the divestiture of some low margin business.

ITW told FIN that it will decide in the near future where to move the small fastener operations. Falling under ITW’s Shakeproof unit (which also acquired Alpine Screw Products earlier this year), some of the operations may be relocated to existing ITW plants in either Waterbury, Connecticut, or in the Chicago area.

ITW, through about 12 fastener producing units such as Shakeproof, Deltar, Fastex, Buildex, Paslode, and Ramset, supplies fasteners to the automotive, appliance, and other end use markets.  ©1989/2010 Fastener Industry News

Scroll down for the July 26, 1990 FIN article below for the completion of the ITW/Buell acquisition.





1990 FIN � ITW Completes Buell Acquisition

July 26, 1990 FIN – Illinois Tool Works, Inc., (ITW), Chicago, Illinois, has completed the merger of Buell Industries, Inc. into ITW Acquisition, Inc
Under the agreement, Buell stockholders electing to receive ash will receive $17.25 for each share of Buell. Former Buell stockholders electing to receive ITW common stock will receive .321 shares of ITW stock for each share of Buell stock surrendered. (A value of $18.10 per share, based on the ITW traded price of 56 1/4 at the end of the day July 18.)
According to ITW, Buell will continue to operate its two divisions (in Waterbury, Connecticut, and Bedford Heights, Ohio) reporting to Frank Ptak, president of ITW’s Shakeproof business. George Largay, formerly president of Buell, is now in charge of Buell’s Highland Products business. Ray Thurston will remain as vice president and general manager of Buells operation in Bedford Heights, Ohio.
Through its Anchor Fastener operation, Buell produces large size fasteners as well as stampings, mainly for the automotive industry. ITW, as we’ve reported, acquired Anchor’s small fastener business earlier this year in a separate deal. Buell also produces a number of wire products including cold heading, sinuus, bright basic, shaved, and polished types.

Buell was founded in 1950 by the late John Largay. Prior to the merger, Largay family members owned 54% of Buell’s outstanding stock. Vincent Largay, John’s brother and chairman of Buell Industries, will remain with the company during the transition and may retire in the near future, according to ITW. George Largay is Vincent’s son.

ITW’s fastener producing divisions, which are organized by markets served, include the following:
• Shakeproof, supplying automotive, industrial, and specialty fasteners and parts.
• Deltar, supplying mostly the automotive industry with plastic fasteners, such as the Scrivit.
• Buildex, supplying fasteners for general construction, roofing, and drywall applications
• Fastex, supplying mainly plastic fasteners appliance manufacturers and other OEM.
• Ramset/Redhead, supplying nails and staples, as well as pneumatic nailing and stapling tools.
• Linx, a supplier of plastic chips.
Incidentally, Fortune Magazine recently (July 16,1990, pages 70-73) had an article about Illinois Tool Works titled “The Ultimate Nuts & Bolts Co.” It details some of the changes that have been taking place at the 78 year old company (started by the Smith family which still owns 28% of it’s stock.)

Some highlights from the article:

*The company reported record results in 1989 (for the fourth year in a row) of $2.2 billion in revenues and profits of $164 million.

*The company is the world’s largest producer of plastic buckets, a leading supplier of fasteners to General Motors, the inventor of the plastic loops that hold six packs together, the producer (with Dow Chemical) of new Zip-Pak resalable food packages, and supplied the painting equipment for a Toyota auto factory (in Japan!).

*The company has 90 divisions, loosely arranged into nine groups, the largest being the $420 million per year construction products group.

*The company’s headquarters, near O’Hare Airport in Chicago, is staffed by 100 people including chairman and chief executive officer, John Nichols, 59 (who doesn’t even have a corner office).

*The company, using two technologies (explained in detail in the article) called “in-lining” and the “80/20 rule”, has been able to raise productivity, reduce work in process inventory and keep better track of production. The two technologies in the future will be applied to purchasing, billing, accounting, and customer service.

*The company now operates in more than 30 countries worldwide.  ©1990/2010 Fastener Industry News

Related Links:

• Illinois Tool Works

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