AKRON—When Ernie Pouttu, president of Harwick Standard Distribution Corp., called on his old friend Ron Anderson late last year, he really was just trying to catch up.
Pouttu had known the president of Western Reserve Chemical Corp. for years, and they normally caught up each year at the ACS Rubber Division's International Elastomer Conference. But because of the COVID-19 pandemic, the IEC was a virtual event in 2020, making it tough to keep up with the normal networking.
But when Anderson answered the call, his first response was, "I understand you want to buy a chemical company," Pouttu told Rubber News. To which the president of Akron-based Harwick Standard said: "No, Ron, I always enjoyed talking with you at the show. ... But now that you mention it, let's talk about it."
That conversation led to an entity of Harwick Standard closing in late July on the acquisition of Western Reserve. Terms of the deal were not disclosed.
The process of putting the purchase together took longer than Pouttu had hoped, but he said that's not unusual, particularly when the firms involved don't normally participate in the merger and acquisition market.
"It's not the type of thing that we do regularly," he said. "We hadn't done an acquisition for quite some time. Those companies that are doing acquisitions all the time have it down to a science."
The integration process will be mapped out over the coming months, but at this point, the two businesses will run in parallel with each other, according to Harwick. Anderson will continue to be involved in the business. The number of employees at Western Reserve was not revealed.
"Ron Anderson has built a very strong business that will be complementary to Harwick Standard and our brand," Pouttu said in a statement. "This was a great opportunity to pair up two key suppliers in the rubber and plastics industries. Western Reserve Chemicals' customer-focused culture makes it a natural fit."
Anderson said the deal enables his firm to "work alongside a great company."
"Now with over 130 years of combined experience in chemical distribution between our two companies, we look forward to continuing great service to our customers," he said.
Harwick Standard Distribution has serviced the rubber, thermoplastics and polymer-related industries for more than 85 years. It is a management-owned and operated sales, marketing and technical support organization. The firm's technical sales team includes 11 geographically-based employees. It has warehouses in Akron and Los Angeles, along with multiple leased warehouses.
Stow, Ohio-based Western Reserve Chemical is a distributor of specialty chemicals and industrial intermediates to compounders and formulators. It provides a broad range of Westco-brand chemicals, including antioxidants, rubber accelerators, tackifiers, retarders, waxes, styrenated phenol and others.
More than just numbers
As a leader looking to grow his company, Pouttu said there are several paths to take. One is to try to grow organically, through such tactics as taking market share from competitors, increasing product line offerings or getting into different industries.
The other is through acquisitions.
"Now, this is an opportunity to grow, but I don't look at it just from a pure numbers standpoint," he said. "I look at it from a standpoint of an opportunity to really benefit both organizations."
Pouttu saw synergies in bringing in Western Reserve, particularly because Harwick Standard typically sells most of its products under the brand names of its vendors, while Western Reserve does much of its business by selling proprietary products under its Westco brand. He knows there will be some overlap, but those will be dealt with over time.
"We intend to kind of keep Western Reserve in its lane and Harwick in its lane," Pouttu said. "There's value in what Western Reserve and Ron Anderson have created, and we don't want to take that away.
"We're proud of what Western Reserve has created, and we're proud of the Harwick name. We're not looking to do away with either one."
The process of contacting customers and explaining the reasons behind the purchase continues, but Pouttu said the reaction of one official at a customer company is indicative of some of the feedback.
"This individual said if anyone was going to buy Western Reserve, I'm glad it was Harwick," Pouttu said. "That, to me, said volumes because it indicated the fact that he thought both companies were customer-service oriented and would be a good fit with each other."