MANSFIELD, Ga.—Beaver Manufacturing Co. Inc. long has sought to expand its production footprint into Europe, and a recent acquisition accomplishes just that.
The leading supplier of technical fiber reinforcements for hoses and other industrial applications in North America has purchased Intercord Thuringen GmbH of Germany, in a deal that not only extends Beaver's geographic reach, but introduces it to new markets and technology, according to Michael Dubin, senior vice president and chief operating officer of Mansfield-based BMC.
Intercord produces cords for tires, hoses, air springs and transmission belts in the automotive and industrial industries. The deal closed Sept. 30 and financial terms weren't disclosed.
The partnership enables Beaver Manufacturing to add RFL-treating technology to its product line and a production plant in Muhlhausen Thuringen, Germany. BMC already has plants in Mansfield and Mexico.
"By acquiring Intercord, we are making a significant expansion into the European market and, at the same time, entering the tire and belt industry," Dubin said. "Our plant in Germany will continue to produce RFL-treated yarns and cords, as well as our hose products that incorporate Beaverloc treatments."
The acquisition comes two years after BMC opened its manufacturing site in Mexico.
BMC said it is the leading converter of hose yarn reinforcement in North America. The company manufactures adhesive-treated fiber reinforcements for automotive, industrial, and oil and gas hoses, converting a wide range of technical textiles for hoses and other industrial applications.
"Beaver Manufacturing advanced the U.S. hose yarn industry with its environmentally friendly treated yarn solutions; now we can do the same here in Germany," said Intercord's Ramazan Yasbay, who will continue as managing director of the German facility for BMC. "Adding their technology and product line to ours will increase the level of innovation in this industry throughout Europe and the Americas."
Controlling its own destiny
Beaver had wanted to establish a manufacturing foothold in Europe previously, however two initial partnerships didn't work out for various reasons, Dubin said.
"We basically made the decision that we wanted to control our own destiny, which meant either a brownfield operation, or make an acquisition," he said. "We found the right company to partner with, and it was a quicker way to the market. If we went with a brownfield operation, it would have taken much longer to for us to get to where we wanted to be."
BMC was introduced to Intercord last year, with discussions starting in May 2019. But just when the two sides were ready to finalize the deal, the COVID-19 pandemic hit, Dubin said, delaying discussions but not stopping progress.
Intercord is the right partner for Beaver not only because of the new markets and technologies, but because of its company culture, according to the BMC executive.
"They're similar to Beaver in that they are privately owned, so more of a family-type owned business," Dubin said. "Their facilities and infrastructures are in excellent shape. I would say our ideas aligned in a way we felt we could come together and be a stronger company moving forward."
The focus for producing the Beaverloc treatment in Europe primarily will be for the hose industry, he said, as the process meets all current REACH—Registration, Evaluation, Authorization and Restriction of Chemicals—regulations in Europe.
The timeframe for establishing Beaverloc manufacturing there, however, will be tied to how the coronavirus pandemic progresses, Dubin said. "We want to get it started as soon as possible, while knowing we're still dealing with the COVID-19 situation."
Intercord employs 92 and has two connected buildings on one site. No changes are planned either for the people or the firm's infrastructure.
"We want stability in the transition," he said.
With some companies looking to move away from RFL (resorcinol, formaldehyde, latex) treatment of reinforcements for tires and other rubber goods, Dubin said it's too soon for his company to strategize there. "We certainly would want to follow the future requirements of our customers and develop in that direction," he said.
Big step forward
The primary markets for the combined business still are in Europe and North America, but there already is much sales activity beyond those regions. "Between all the companies, we're shipping products more or less all over the world."
While it would have been easy to delay the deal longer until future prospects are clearer, Dubin said in the end Beaver decided it needed to move forward.
"We were confident in our strategy and COVID-19 has created a difficult situation for all of us," he said. "But when we get to the other side we'll be in place with our strategy and what we wanted to accomplish already. We believe that will make us strong going forward."
BMC certainly felt the impact from the pandemic in April, May and June, but started coming back reasonably strong in August and September.
"We're not back to normal, but I would say we're very busy right now, and that includes Intercord, Mexico and Mansfield—all three facilities," Dubin said.
The companies have been following upgraded safety guidelines at all three sites. He said Mexico has extremely specific government regulations to follow, and that the headquarters site in Mansfield adheres strictly to recommended guidelines of the Centers for Disease Control and Prevention.
There have been no issues inside any of the locations, Dubin said, with the spreading of COVID-19.
"With our type of production, people typically are not on top of each other," he said. "They're not 6 feet apart. They're 12 feet apart or more. It's a little more conducive to keeping people separated."