Quanex Sees Growth with Edgetech
February 1, 2011
On Monday, two long-time competitors in flexible, warm-edge spacer technologies were brought under one roof as Quanex Building Products Corp. announced the acquisition of Edgetech I.G. Inc. The deal still must be approved by the government, executives note, but they are already eying growth opportunities for the combined operations, which will bring together Edgetech with Quanex's Truseal Technologies, as well as Mikron Industries and Homeshield Fenestration Components.
"We purchased with an eye on growth," says David Petratis, Quanex chairman and CEO. "There will be changes, but we believe in Edgetech’s growth."
"We knew that Edgetech has lot of opportunities, and as a part of Lauren, we worked very well, but I think we needed a larger parent," explains Mike Hovan, Edgetech president. The spacer manufacturer's parent, Lauren International, realized that as well, he continues, noting that, "at some point it had to let go to take our company to the next level."
Quanex was "the right choice" for a number of reasons, according to Hovan. "We had a number of criteria we were looking for. Quanex is a company that understands fenestration as we do. For us, the fit between the two companies, the culture, the core values, are in alignment."
Petratis points out a number of factors that made Edgetech attractive to Quanex–even given the fact that it already owned Truseal. "We believe that the banner of energy efficiency needs to be pushed and developed. Both Edgetech and Trueseal push that in that arena," he states. "Bringing those minds together will create a positive and new thinking, which the industry needs to provide homeowners and building owners more energy-efficient solutions."
"IG is where Edgetech’s strengths are," adds Hovan. "Quanex helps bring to the table a group of people that we can now collaborate with to bring new products. The more we get those people in a room talking, the more we get better products. When we start doing that in products with a focus on fenestration, you never know what you’re going to come up with. Good people and good ideas will definitely bring new products."
"Edgetech brings the foam and dual-seal technology," Petratis states. "Trueseal brings butyl technology, and each company brings its respective customers. Our technical people get in touch, work together and grow together."
Last year, Quanex launched the Project Nexus initiative, bringing together people from its HomeShield, Mikron and Truseal units to jointly develop window and door products and technologies Such efforts led to the development of the ImperiClad system with Mikron and HomeShield working together to create a new door framing system. Mikron and Truseal teams collaborated to design the Energy Core window, he also points out. "Bringing minds and technologies together to solve issues for more energy-efficient solutions for customers is what we strive to do best," Petratis states.
"If we can give our customers the ability to have Edgetech help us build on that, and we can work together to build systems and products that add value to the customers, and do that in a blended way, we can be more successful," he continues. "With our respective technical products, we’ll help the customers grow. We believe fenestration customers should be able to do component solutions, energy efficiency to advance their businesses, and this acquisition will allow them to do so."
Neither executive expects the acquisition to have an immediate impact on customers. "Internally and externally they should expect the companies to embrace each other," Petratist notes. "There will be no major changes, but companies evolve as they grow. Neither Edgetech nor Quanex are today what they were when they started."
"We’ll continue to serve our customer base, and now an extended customer base," adds Hovan. Pointing to the traditionally strong marketing programs both Truseal and Edgtech have provided their manufacturers, he adds that the intent for both companies has been to help customers be successful. "We work with our customers to make them more successful. We’ll have added resources to enhance that. Whatever we can do to make our customers successful, we’ll do and the marketing piece is only one part of that."
Both executives also see a continued place in the market for both Truseal's Duraseal and Edgetech's Super Spacer products for the long term. "There’s a role for both and our respective customers have validated that," Petratis states. "I would agree," adds Hovan. "Some of those technologies might result in new technologies. The opportunities to bring our collective customer base together will create new products in the field of IG and fenestration in general."
One other reason Edgetech was attractive for Quanex was its interenational production and sales operations. "Edgetech is well-positioned internationally. It fills a growth need for Quanex," Hovan states, pointing to manufacturing plants in the UK and a new facility planned for Germany. "We’re investing to build our solar capabilities internationally, and plugging in our Edgetech capabilities will move things faster," he continues."It complements the growth and aspiration of Quanex and its businesses."