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FASTENER HISTORY
2000 FIN – Lepore: Marmon Companies Really Are Autonomous

June 29, 2000 FIN – Würth, Pentacon, Questron, Distribution Dynamics, Alleghany, Bossard, Industrial Holdings, MascoTech, Park-Ohio, Citicorp and other companies have become recognized fastener industry names in North America through acquisitions in the past few years.
With the purchase last month of the well-known Nylok Fastener Corporation, the latest name to increase its prominence in the fastener industry is the Marmon Group.
Marmon has its own style as a consolidator. The 100+ companies within Marmon absolutely operate autonomously, according to David Lepore, president of two of the fastener companies – Robertson Inc. and Pan American Screw – in the group.
“Everybody is an entrepreneur,” Lepore described the Marmon operation.
Despite being a $6.5 billion company, Marmon has only about 50 people at its Chicago headquarters. And those are mostly accounting and tax people, Lepore noted.
Companies in the group are called “members,” rather than subsidiaries, segments, divisions or branches. “Member” is the official wording on our calling cards and signage,” Lepore pointed out.
All of the companies have their own “Inc.” or “Ltd” status, he added.
Marmon is not looking for synergies in acquisitions, Lepore told FIN. “We have our own market,” he said of each firm. “Nylok will stand alone. There may be cross fertilization where it benefits both companies, but it is an arm’s-length transaction.”
One reason for that is each company is responsible for its own bottom line, he explained. “Most people don’t understand such pure autonomy,” Lepore acknowledged.
When the day comes for Lepore or Nylok president Max Dorflinger to groom successors, they will be solely responsible. “Marmon doesn’t have people sitting anywhere waiting,” Lepore said. “It is up to each company to build its team.”
That is one reason why Marmon looks carefully at the management when acquiring a company. “You buy a business for the people who are running it,” Lepore explained. Indeed Marmon was quick to announce that Dorflinger would remain president of Macomb, MI-based Nylok. “The emphasis is that the entire management group stays,” Lepore added. Management staying on is shown at the top.
Marmon has been headed by CEO Robert Pritzker since 1953. The Pritzker family is best known for its ownership of the Hyatt Hotel chain and Carnival Cruise Lines.
Hyatt is not part of Marmon.
Marmon fastener holdings are manufacturers Pan American Screw of Conover, NC; Robertson Inc. of Milton, Ontario, Canada; Deerwood S.S.deCV in Mexico; and Atlas Bolt & Screw Company of Ashland, OH; and fastener distributor SureDrive Inc. of South San Francisco.
Those companies aren’t for sale, Lepore noted. “Marmon very seldom sells something.”
Lepore came into Marmon with the 1980 purchase of the companies in TransUnion Corporation.
When he mentioned that he handles fastener acquisitions for the Marmon Group, Lepore showed how interested they are in buying: “Know anyone for sale?” Lepore asked.
What is he looking for? Lepore isn’t interested in “fancy statements,” such as one broker sent recently.
Lepore, a former chairman of the Industrial Fasteners Institute, responded by asking to speak to the business owner. The broker “threw up walls” to an interview with the owner, and Lepore mailed the brochure back. “There was a lack of trust,” Lepore recalled. “If trust is not there, we are not doing business.”
The trust issue is why Lepore rejects 50% of the fastener companies approaching Marmon. The biggest problem for private companies is opening the books and revealing all the details, Lepore observed. “We just have to have you tell us everything.” ©2000/2012 Fastener Industry News
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