Industry Reacts to Quanex Purchase of Edgetech
By Tara Taffera
Quanex Building Products Corp. announced in late-January that it had
signed a definitive agreement with Lauren International to acquire Edgetech
I.G. Inc. for $107 million in an all-cash transaction, everyone in the
industry immediately started talking. The announcement seemed to evoke
more questions than answers. Among them, how will competitors Edgetech
and Truseal be integrated together? Several industry members who declined
to be identified said that until they know how, or if, the two companies
and technologies will be melded together, there isn’t much to say.
Others did already have opinions to voice, and that includes Bob Pecorella,
president of Northern Building Products in Teterboro, N.J., a long-time
“It is savvy of Quanex to put Edgetech/Truseal under one roof,” says Pecorella.
“Northern has been a user and supporter of warm-edge flexible spacer technology
for more than two decades. Having them together under the same ownership
is an unbeatable combination of the foremost technology for insulating
spacer for our industry. They are very smart about doing this. It’s a
win-win, except for those not making a warm-edge flexible spacer.”
Another question is how the merger of two major spacer suppliers will
affect the competition.
GED is a competitor to both companies on the spacer side, and Dan Reinhart,
director of sales, says his reaction was mixed when he heard the news.
“I was surprised, though nothing surprises me anymore in this industry,”
Like many, Reinhardt agrees that there are many questions.
"It is savvy of
Quanex to put Edgetech/Truseal under one roof."
—Bob Pecorella, president, Northern Building Products
“I think there was surprise and shock in the industry,” he says. “Customers
are worried, what if they eliminate my product line? How will it affect
my pricing?’ They [executives of both companies] said the right things—that
they are looking for growth. I still think there are a lot of questions
Gerhard Reichert was involved with Edgetech at its inception and is credited
for helping invent Edgetech’s SuperSpacer product. He now serves as president
of industry competitor Glasslam.
“It is certainly interesting news because I was inside Edgetech for many
years so I know ideas of selling have been floated around in the past.
But when it would happen was news to everyone,” says Reichert.
So was he surprised Edgetech was sold to Quanex?
“Yes and no,” says Reichert. “It’s a mixed bag. There are always changes
in this industry. Mergers and acquisitions bring about different dynamics
and this merger of two competitors will as well.”
Pecorella hopes the merger will provide access to improved technologies—at
a better price.
“It’s good for all the people using one or the other because I hope it
will give us good access to both at a competitive price,” he says.
Quanex and Edgetech Execs Express Optimism
By Megan Headley
Executives at both companies say they’re optimistic about what this merger
of technology and expertise will mean for the industry.
Edgetech president Mike Hovan told DWM magazine that Edgetech parent company
Lauren International has been looking for a buyer for the company that
would better be able to allow the warm-edge spacer manufacturer to grow.
“Lauren International … came to the realization that a parent with a little
bit more capability would be in a better position to allow
Edgetech to continue to grow to the extent that we believe it can. It
wasn’t an active strategy, it’s just been something that’s been in the
backs of the minds of different people in Lauren International,” he said.
“The opportunity arose, we started talking, and we are where we’re at
“Edgetech will allow us and be the facilitator to expand into the commercial
market,” David Petratis, chairperson and chief executive officer of Quanex,
added in the interview. “Quanex has some great capabilities in our vinyl
portfolio that can help commercial customers, and joining together helps
us to get in front of those specifying engineers. It’s one of the attractive
things that we believe help benefits both teams.”
Edgetech’s international presence, including facilities in the United
Kingdom and Germany, are another potential advantage. “It was an important
part of the evolution of Quanex that we develop internationally and the
merger brings us strength,” Petratis said. “They’ve got some exciting
international expansion and we want to continue to build on that momentum.”
Hovan said a number of factors made Quanex an attractive buyer. Among
them was “the fact that they were in the same industry and understand
the business was a big piece of it.”
He added, “Secondly, and probably the largest piece, was the real alignment
of how Quanex goes to market and how they run their business compared
to how we run our business; there was a very direct alignment of our core
values as both a company and as individuals within the companies that
we’ve had the pleasure of meeting. That’s what we were looking for—somebody,
frankly, who has, the muscle to help grow the business to what we think
it can be …”
Petratis noted that discussions began in 2010 and said that Quanex is
looking forward to the growth potential that this acquisition offers.
arose, we started talking, and we are where we’re at today."
—Mike Hovan, Edgetech IG
Petratis said that the acquisition must be approved by the Federal Trade
Commission—typically in 90 to 120 days—before employee changes can be
discussed. On the topic, he simply commented, “We’re going to build on
the people and capabilities that we’ve got. We think one of the attractive
elements of Edgetech were the strengths of the leadership and the people
that have made up the business.”
Edgetech will be part of Quanex’s Engineered Products Group, which also
oversees Truseal. Petratis said Quanex expects the combined strength of
these two companies to “advance the technical capabilities, especially
“We believe the envelope can be pushed and when you bring [together] the
butyl-based technologies, single-edge technologies of Truseal and the
foam-based, dual-sealed capabilities of Edgetech, we think those minds
will help push that envelope,” he added.
© Copyright 2011 Key Communications Inc. All rights reserved.
No reproduction of any type without expressed written permission.