Global Distribution Giant Sees Worth Of NZ Company
Global Distribution Giant Sees Worth Of New Zealand Company
New Zealand fastening distribution company, EDL Group, has been purchased by global assembly and fastening organisation Würth Group.
Following the purchase, which takes effect 1 January, 2001, the company will retain its name, brands and operations in New Zealand and Australia. EDL will serve, according to current directors Chris James and Paul Lucas, as Würth’s ‘bridgehead’ to develop Asia-Pacific opportunities for fastener-related business.
“The name Würth is synonymous around the world with professionalism, competency, profitability, quality commitment and customer service standards across a wide area of operations. For them to have selected EDL Group as the company they will use to develop and broaden their fastener business in this part of the world is a true vote of confidence in our company, our people and in New Zealand overall,” said Chris James.
According to Paul Lucas, the directors of the privately owned EDL Group were not considering selling their operation until an approach was made directly by Würth in June 1999.
“The Würth Group employed the services of New Zealand’s former Trade Commissioner to Germany and business adviser Stephen Diver to assess both the New Zealand and Australian markets for possible purchases.
“Despite a number of candidates—particularly in Australia—the recommendation was made that EDL would provide the best fit with Würth’s stringent standards and business philosophies.
“We had been approached by a number of companies since we began the company in 1975. Würth’s overtures, however, made us consider a number of options for our company, particularly in terms of how strategically we would continue to manage growth in an increasingly competitive global market. It made us also address issues related to what was best for the company, our employees and our customers. Gradually, the thought of being part of a global group began to have appeal,” he said.
According to Chris James, although they were flattered by Würth’s initial approach they decided to put the purchase of the company out to international tender.
“The process was managed by local merchant banking company Clavell Capital. While other companies were conducting due diligence on us, we had the opportunity to also investigate these organisations based on criteria we had set.
“Strategically they had to add significant value to the EDL Group while also being sensitive to the needs of our staff and customers. We weren’t interested in someone who would downsize the operation or who weren’t committed to New Zealand.
“In contrast to other candidates, Würth’s policy of profit retention to support growth was also a compelling consideration to us,” he said.
According to Stephen Diver, the negotiation process was arduous but it had a positive outcome for all parties.
“Würth globally has a policy of being a multi-domestic versus a multi-national organisation.
“They put an absolute premium on local knowledge, skill and competency rather than imposing a uniform international standard. It was important for them to have a New Zealand company with a strong brand and customer base on both sides of the Tasman. As well as purchasing ‘the bricks and mortar’ and a profitable business, they also were buying local knowledge.
“The fact that Würth already had a successful New Zealand operation—Würth New Zealand Ltd—servicing the automotive, engineering and marine industries, and employing over 40 staff, was also a factor in Würth’s favour.
“Having a major organisation like Würth choosing a New Zealand company as the platform from which to build their regional business can only be good for the country,” he said.
Having sold 100% of EDL Group to Würth, Chris James and Paul Lucas have resigned as directors but have been retained as consultants. Along with Stephen Diver, they become part of an advisory board and will be active in developing new growth strategies for EDL.
Len Campbell, who has been with the company for 20 years—most recently as group supply manager—has been appointed CEO of EDL Group.
The new appointments and management structure take place from 1 January, 2001.
EDL Group is a privately-owned company incorporating the businesses of EDL Fasteners Limited, EDL Fasteners Pty Limited, and Global Fasteners Limited.
With headquarters in Auckland, EDL Group employs 121 people, has 8 branches throughout New Zealand and 2 in New South Wales. Current sales are $30 million per annum with 30% of group revenues coming from Australia.
The Group’s core business is the distribution of over 20,000 different types of metal fasteners—sourced from Europe, the United States, Taiwan, China, Australia and New Zealand—to a range of industries including manufacturing, construction, engineering, maintenance and re-seller sectors.
The Group has over 6,300 clients in Australia and New Zealand including organisations such as PDL Industries, Fisher & Paykel Limited, CWF Hamilton & Co Limited, Gallagher Group Limited, Masport Limited, True-Test Limited, Franklin Machinery Limited and Dexion (Aust) Pty Limited.
EDL Group was the first fastener company and the first international merchant company in New Zealand to be accredited to ISO 9002 standard.
About Würth—The Assembly Professionals
The German Würth Group is headquartered in the Kunzelsau/Region of Hohenlohe, Germany. Established in 1945 by founder Adolf Würth. At the age of 19 on the death of his father current Chairman of the Advisor Board of the Würth Group Reinhold Würth took over the management of the company. Along with one employee and his mother he set about building a Group which today has become the world’s biggest direct sales company specialising in connecting, fastening and assembly technology.
With offices in over 76 countries, and 2000 year end sales anticipated to be 10 billion DM (approximately NZ$ 11 billion), the Würth Group is made up of 226 independent companies employing more than 34,000 people. Würth continues to enjoy double digit annual growth and is actively growing, or acquiring, businesses around the world.
The product range comprises 50,000 items—from screws and standard parts over tools up to storage systems or work protection clothes.
As a product wholesaler, the
Group supplies world-wide 1.5 million customers in the
automotive trades, cargo handling, metal working, sanitary/heating, electrical, wood working, construction and industrial sectors.
In addition to its core business, Würth Group is an active supporter and investor in the arts. Würth owns and operates three museums and stages a number of major art exhibitions around the world each year.
For further information, please contact:
Chris James/Paul Lucas Penelope Barr/Dwight
Director Beyond Public Relations
EDL Group Tel: +64 9 306 1801/ 302 7153
DDI: +64 9 571 5520 Mobile: +64 25 835 383/ 25 907 188
Mob: +64 21 765 923/ 21 488 467 Fax: +64 9 302 7169
Fax: +64 9 579 0850
Tel: +64 9 373 9710
Mobile: +64 21 646 463