1997 FIN – Crawford: RB&W, Arden Futures Within Park-Ohio Is in Logistics
August 4, 1997 FIN – At first his interest wasn’t in fasteners. And it wasn’t a “location, location, location” deal that caught Cleveland, Ohio-based Park-Ohio Industries’ chairman Edward Crawford’s interest in buying another Cleveland area business – RB&W Corporation – in 1994.
Crawford first became interested in RB&W because he was experienced in industrial manufacturing companies.
But one buy lead to another, and with the official closing of the sale of Arden Industrial Products Inc. on July 25, Park-Ohio is now a major name in the fastener industry.
The chairman recognizes Park-Ohio is now “a very serious player based on its gravity and size.”
RB&W, the former Russell, Birdsall & Ward, despite its historical name in fastener manufacturing and three nut plants, had become primarily a distributor. Crawford found he likes the “complete assumption of quality control and management of supply to assembler” that RB&W does.
Arden, a distributor to major name OEMs, gives Park-Ohio “the opportunity to grow on a national basis,” Crawford told Fastener Industry News.
Arden distributes for 70 fastener manufacturers to 7,500 OEMS and distributors. Customers include Whirlpool, Polaris, Deere, Frigidaire, Carriers, Navistar and Raytheon.
Arden’s operations will be integrated with RB&W Logistics “as quickly as possible,” Crawford said.
Park-Ohio describes RB&W Logistics as a “national distributor of various commodity products to the industrial market, specializing in supply chain management of several thousand items, primarily fasteners, principally to original equipment manufacturers.”
The two companies are well positioned to take advantage of increasing single-source supplying to American manufacturers, Crawford said.
By 1998 fasteners should total $300 million in sales for Park-Ohio, Crawford projected. It could be more if Park-Ohio buys another fastener company – an idea Crawford told FIN he is interested in.
Fastener sales would be just over half the $550 million company Park-Ohio is. Park-Ohio paid $42 million for Arden.
Park-Ohio (NASDAQ-PKOH) has ranged from 11 1/4 to 17 in the past year and was at 15 1/4 after the sale closed.
The first six months under Park-Ohio will be “a shakedown cruise,” Crawford told FIN. Arden’s “good concepts and good management will be blending” into the corporation.
Crawford said Park-Ohio’s “highly diversified, totally decentralized” style means those decisions will be made over time by Andrew Arena, who has headed RB&W’s logistics business.
Crawford termed Arden “a pretty solid company. They’ve had a few painful years, but not because of their people, their customers or products.”
Arden expands the potential for logistical business with its multiple locations and personnel experience, Crawford pointed out.
The response of Arden’s customer base to the deal delighted Crawford. Corporate customers like the long-term support and liquidity of Park-Ohio as the parent company, Crawford explained.
Crawford predicted the fastener will quickly face what other industries have gone through or are going through: consolidation.
Expanding RB&W and Arden distribution won’t eliminate small manufacturers, Crawford said. “RB&W’s logistics program of sales and delivery service can make a small manufacturer more efficient,” he commented. The manufacturers “can concern themselves with the business they do best.”
Since Park-Ohio also is a manufacturer of a variety of products from home and garden to hardware items, the fastener divisions can grow by supplying fasteners “to ourselves,” Crawford pointed out.
Park-Ohio will soon have 35 locations, and Crawford expects to expand in other product lines besides fasteners. ©1997/2010 Fastener Industry News.
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