PAWCATUCK, CONN.-Davis-Standard's hometown is a sleepy village in southern Connecticut, just across the Rhode Island line. Employees swap fishing tales. President Robert Ackley's office sports prints of fishing boats. But the modest appearance can be deceiving. Through internal growth and a series of acquisitions, Davis-Standard has become a powerful force in extrusion equipment. The division of Crompton & Knowles Corp. holds more than 50 percent of the U.S. market for single-screw extruders - a market of about 1,000 machines a year. Competitors simultaneous-ly grumble about Davis-Standard and worry about its next move.
That move is likely to happen a world away from Pawcatuck. Fresh off two major 1994 acquisitions that brought in Egan film and coating machinery and NRM extruders, Davis-Standard now wants manufacturing capacity in Europe. That would make Davis-Standard a true global player, Ackley said.
``We sell into Europe,'' he said, ``But not a lot. We think that to be a strong company servicing Europe, we'll probably have to have a platform there.''
The company is considered a major player in the Far East, especially in China, which is a major buyer of its wire and cable machinery. Exports account for about one-quarter of sales.
Ackley said there is no deadline to build machines in Europe. Davis-Standard already has a sales office in Gloucestershire, England, ``but we're going to have to have more than that to be considered by the Europeans to service them well,'' he said.
Crompton & Knowles, which also makes dyes and specialty ingredients for food and pharmaceutical industries, breaks out sales and profit numbers for its machinery business, but only in its annual report, which has not been released.
But 1994 should be the second year in a row with a sales gain of more than 20 percent. In December Ackley was predicting a sales gain of about 25 percent over 1993, when Davis-Standard had sales of $151 million from its specialty process equipment and controls business segment, which includes extrusion systems, blow molding machines and related process controls. And 1993 was a good year, too-sales increased 23 percent over 1992.
Acquisitions since 1991 have greatly expanded the company's machinery scope. Davis-Standard now makes Sterling industrial and bottle blow molding machines; twin- and single-screw compounding systems; extrusion coating and laminating and web converting; blown and cast film; reclaim systems; fiber systems; and extruders for pipe, profiles and tubing, sheet systems and wire and cable. Its in-house HES unit makes controllers for the machines.
About 950 employees work at two facilities in Pawcatuck, the Sterling plant in Edison, N.J., and the Egan plant in Somerville, N.J.
Managing growth by acquisition has been a challenge. Davis-Standard officials stress that when they buy companies they retain the separate identities of those machinery lines. For example, they have created a dedicated manufacturing area for NRM machines in Pawcatuck, with a separate staff.
``It's our intention to manufacture and supply all the equipment that NRM used to supply,'' said Wendell O. Whipple Sr., NRM industry director, in an interview at the plant last fall.
Integrating all the new-product lines, people and facilities into a single company has been difficult, as expected, according to Ackley, a native of Groton, Conn., whose first job out of high school was draftsman at Davis-Standard.
``You should always go into an acquisition assuming that it's going to be damned difficult. We are very pleased with the way Sterling, NRM and Egan have gone. Overall [it's been] very good,'' Ackley said.
The addition of Egan in May 1994, coupled with base business growth, boosted sales for Davis-Standard by about 50 percent in the third quarter. But the firm's backlog of machines also increased - to about $68 million. By comparison, backlog stood at $38 million at the end of 1993.
How does Davis-Standard deal with overlapping technologies?
``The first answer is, you do it the way the customer wants,'' he said. That means informing a customer about another Davis-Standard machine that may be better, ``but don't try to twist his arm,'' Ackley said.
Finally, the Big Question: Does Davis-Standard plan to keep buying companies?
``If the opportunity comes along and it fits our business strategy and supports a particular business segment that will allow us to do a better job for the customer, fine, we'll look at it. But not just to get bigger. We really aren't trying to get bigger,'' Ackley said.
It's a touchy subject. In a Plastics News story from NPE '94 in June, following the May 18 purchase of Egan, Ackley said Davis-Standard had no plans to acquire other companies. But the NRM purchase followed just a few weeks later, raising competitors' eyebrows.
Ackley insists his comments were truthful at NPE. Davis-Standard had bid on NRM a few years ago, but no deal resulted. The sale fell together after NPE, he said, calling it ``the quickest deal in the world.''
Licenses twin-screw compounding extruder technology from JSW
Plastics Machinery Inc.
Buys Sterling blow molding and extrusion businesses from APV
Chemical Machinery Inc.
Buys Clipper Machines Inc., a supplier of wire-making equipment such as high-speed takeup machines, payoffs and tension brakes, that was itself started by Davis-Standard employees.
Buys Egan Machinery Division of John Brown Inc., including cast film and extrusion coating equipment.
Buys extruder business, NRM Polymer Division, from McNeil & NRM Inc.