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April 16, 1982 FIN – Accurate Threaded Fasteners has been bought from its conglomerate owner, Beatrice Foods Co., by its manager, Donald E. Surber.
The Chicago manufacturer became a Delaware corporation April 1. Beatrice will retain an interest during the transition. It is a management leverage buy-out. “First of all, we are not trying to be all things to all people,” Surber told FIN when asked his plans. “We have targeted a much tighter market: the specialty market.” Historically, Accurate has been a regional fastener house during most of the 40 years or so it has been in business.
It started in the 1940s as a distributor. For about the last 20 years it has been in manufacturing. In 1967 Accurate Threaded was bought by Beatrice, who continued the pattern of trying to offer all fasteners to all local markets. Four years ago Surber became general manager and he began to change the direction. “We have expanded it to a nationwide manufacturer of specialty fasteners,” Surber told FIN. “We’re an application engineering house. We’re not going out and trying to develop product lines like an Illinois Tool Works (Surber’s former employer) or Camcar (division of Textron). We are taking a part at a time, an application at a time and designing a product to fit and satisfy a customer need.” “This is something the major conglomerates don’t understand that well. They want to see product line planning. They want to see product lines developed. In this industry, quite frankly, we’ve felt that our strengths were in the job shop, if you will.” Although the $12 to $15 million Accurate Threaded Fasteners operation is well known in the fastener industry, in Beatrice Foods it was almost lost.
Corporate public relations had to look in a directory to see if they had any fastener companies then confessed to FIN that they were usually not informed of the buying or selling of anything that small. It isn’t the fastener business, per se, that Beatrice was disenchanted with, Surber says. “Beatrice is going through a five-year plan, a redeployment of assets. Quite frankly, what a lot of the conglomerates are under right now is a lot of pressure from Wall Street to get out of the businesses that they don’t know anything about. They are good food people. They are good managers. But, they bought, back in the 60s, many small manufacturing comp0anies. I think you are going to see this not only in the fastener industry but in many other metalworking industries where large conglomerates were attracted because of high profit margins to unrelated businesses.” “I think Wall Street has reached a point where they have learned that just because a guy has learned how to manage a dairy does not make him a good manager of a fastener business,” Surber told FIN.
“They brought guys in out of the shoe business. Every industry has its varied ways of doing business and it takes a while to pick up the ins and the outs.” Surber predicted that we will see more and more conglomerates dropping unrelated businesses.
Exceptions will be companies such as Rexnord and Textron, which, instead of buying the odd fastener company, decided “that if they are going to get into the fastener business, they will build a fastener group,” Surber told FIN. “Put together several related companies and then you can put in a fastener group manager.” ©1982/2009 Fastener Industry News. Contact editor@GlobalFastenerNews.com for written permission to reuse or reprint this article.