NOBLE, Okla. (May 9, 2008) — Walter J. Morris is quietly exiting the rubber and synthetic latex breather bag industry.
The entrepreneur—who gained notoriety for his outspoken opinions, honesty and securing deals with a mere handshake over the last 30 years—and members of his family have sold ML Products L.L.C., until 2007 known as Morris Latex Products Inc. Mundelein, Ill.-based Medline Industries Inc. purchased the company for an undisclosed amount.
His decision to sell the company—which includes operations in Poland and Mexico that ML Products purchased in 2003—will end almost 40 years in the rubber products business for Morris, who started in the industry in 1970.
The acquisition of ML Products gives Medline a much bigger share of the disposable natural rubber and synthetic latex anesthesia breathing bag market and ML Products' plant in Noble, according to Medline President Tom Pistella. The company also gets the four growing businesses in Mexico and Poland and two manufacturing facilities in the two countries, all operating under the umbrella of MMS L.L.C.
Walter Morris' two sons, Tim and David, will remain with Medline, Pistella said. Tim will remain as president of ML Products, the acquired company's flagship business and its biggest money producer, while David will continue to head up MMS. No work force changes are planned.
“There was mutual interest on both sides to create something better,” Pistella said, adding that the possibility of a sale has been in the works for two years. “When you have two companies that are doing well, it takes time” to close a deal, he said.
Medline, a diverse medical product manufacturer, purchased components from ML Products and had a strong working relationship with the firm for years, Pistella said. “I think there's a great opportunity here.”
“It's a very good deal for both companies,” Walter Morris said. “Medline will help the Noble, Poland and Mexican plants grow.”
Pistella said Medline was interested in the Oklahoma-based company because it is a solid citizen, is ethically run, has invested in technology, has a lean operation and has strong values.
The ML Products group of companies will operate as a separate entity, he said, adding that the firm has a strong base of existing customers and, while Medline can help in some areas, it will continue to run itself.
Privately held Medline, with annual sales in the vicinity of $3 billion and seven production facilities in North America, was founded in 1966 but its roots date back to 1910 when it started as a garment manufacturer. It has grown to become a major player in the health care product arena in the last decade.
Medline produces a variety of NR and synthetic latex surgical and examination gloves and manufactures an estimated 100,000 medical products, many of them elastomer-based, that it distributes. It also has one of the largest textile lines in the industry.
The company made a big splash in the health care industry in November 2003 when it purchased Maxxim Medical Inc.'s medical products operation. The move, coupled with its own expanding glove production base, made the company one of the largest medical glove manufacturers globally.
The firm moved its Maxxim glove production to Asia from its plants in Canada and South Carolina in March 2004 to consolidate its glove manufacturing operation and cut costs, which allowed it to compete effectively in the worldwide marketplace, it said at the time.
While Medline is expanding, Walter Morris won't be wondering off to a rocking chair to call it a day.
“I'm planning to retire, basically for estate planning purposes,” he said. “It was time to get out. It seems the only thing people care about today is the lowest price, and I came from an era where you partnered with your customers.”
But he plans to remain involved in the business world. “My goal is to help small entrepreneurs who are struggling,” he said. “If I can give something back, I will. I was also active in politics and I still like to dabble in that. And maybe I'll play more golf.”
He also has real estate holdings that will keep him occupied.
Looking back, Morris is obviously proud of his accomplishments.
When Morris Latex, founded and launched by Morris in 1979, began making respiratory bags in 1980, it was producing 25,000 bags a day, he recalled. Today it makes 480,000 bags a week.
“In 28 years, we only lost money once, and that was in the first year,” he said. He swore that would not happen again. “We did just under a million in sales in my first year, and last year we had sales of about $20 million.”
One of the keys to a successful business is controlling costs, especially production costs, according to Morris, who from 1970 to 1979 was vice president of sales for Seiberling Latex. “We had 11 expansions in the last 13 years, and we paid for those expansions out of our checkbook. We have had no debt for the last 13 years.”
The other keys are building strong relationships with your customers, quality products and fulfilling their needs on time every time.
“We were pioneers as a sole source manufacturer to our customers 28 years ago because we guaranteed capacity delivery,” Morris said. “In 28 years we had less than 10 back orders. We put believability in what we did, and we never let a customer down after the first year. We lost one customer that first year, and I said it would never happen againàand it didn't.”
The combined Mexican and Poland businesses—at the time a five-company operation—were bleeding red ink when ML Products purchased them in 2003. The firm shaved 20 percent in costs from the Mexican business in less than a year, and “we turned a losing company into a profitable one in nine months.”
He credits his son David for making the right moves with MMS and his son Tim for building ML Products into a thriving operation in the last 16 years when Tim was making many of the key decisions.
“I let my kids make decisions—even when I thought they were wrong,” Morris said. But that's how they learned, and they obviously did a good job because the company continuously prospered and made money, he said.