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Ron Stronks, founder of Erie AP (left) and Oliver Stepe, president of YKK AP America
YKK AP America Inc. (YKK AP) today announced the acquisition of high-performance facades solutions provider, Erie Architectural Products Group (Erie AP)—its first in North America. This strategic acquisition represents a significant move toward where the construction market is trending; fabricated, pre-assembled products are an area of specialization for Erie AP, and one of focused growth for YKK AP.
Founded in 1981 by Ron and Nellie Stronks, Erie AP has grown to become a leader in the curtainwall industry with over 250 employees in the U.S. and Canada. Headquartered in Lakeshore, Ont., the company engineers, manufactures and distributes its Enviro|Facades® curtainwall systems across the U.S. It provides design assist collaboration services, in-house engineering services, performance validation, state-of-the-art manufacturing and technical support to glazing contractors.
Ron Stronks continues to run the company along with his sons Chris and Dan and a highly experienced leadership team. He will remain integrally involved in the business and continue to lead Erie AP as its president.
According to Oliver Stepe, president of YKK AP, while the YKK group of companies has completed acquisitions in other parts of the world, it’s not a regular occurrence globally.
“It’s not a norm for our global organization, but it is considered on a strategic basis. I had considered the idea of an acquisition since I became president in 2016 and based on Erie’s core competencies they caught my attention,” Stepe told USGNN™ in an exclusive interview. “As the increase in demand and trend for pre-glazing and modular construction [grew] I thought about contacting Erie to discuss the opportunity to get together.”
He adds, “I believe the timing started to become good for Erie, as well. So over the last year we started working on it and just came together.”
Stronks adds, “Our company started in 1981, so we’ve been on this journey for 38 years and as we started looking to the future we thought it would be best to align with a strategic industry partner for full fabrication and engineering solutions in the market. We were ready and willing to look at the alignment.”
He continues, “YKK AP will provide our employees with a rich pathway for career development and growth. In addition, the powerful combination of a quality product company like YKK AP working together with a specialized facades business like ours will open up tremendous opportunities for growth for our customers, for our employees, and for the industry at large.”
Strategic Partners
When it came to exploring an acquisition opportunity, Stepe says it was critical to partner with a company that had similar synergies and values as YKK AP.
“I researched the market and looked at other opportunities and I think what really made this the best decision is that that Erie AP is a holistic company. It has a lot of depth in engineering, product technology and an incredible manufacturing plant that executes at a high level in terms of efficiency, quality and customer satisfaction,” he says. “But beyond the core competencies, there really is a good synergy in the core values and in the way the leadership has developed the company and how important employees and customers are. YKK AP has a rich history of focusing on that and Erie, even though it was founded as a family-run business, has really developed a sophisticated level of awareness in terms of their role and responsibility to market and the communities in which they work. Ultimately, their mission is clearly aligned with ours. This wasn’t an asset purchase. Erie AP is a high-performance company and that’s what we were looking for.”
Product Focus
According to Stepe one of the reasons for exploring an acquisition involved the market’s increasing shift toward unitized, pre-fabricated and modular product.
“This is still a minor portion of our business, but one in which Erie AP is highly focused,” he says. “As we looked to the future of our business, it was clear that we needed to grow our offering for prefabricated, pre-assembled products. By bringing Erie AP under the YKK AP umbrella, we are making a progressive move to meet what we see as a growing market demand for unitized products. At the same time, YKK AP’s broad product line will help enhance Erie AP’s position in the market and allow them to further serve their customers. I am excited for this opportunity, and I feel confident that these two great brands will come together as one great company.”
Stronks adds, that in looking for a partner, and having worked with YKK AP in the past, he also saw a number of synergies.
“One thing that attracted us was they are privately held and true to their core values,” he said. “I’ve also seen good corporate governance in watching Oliver and his team and the way they function. We think this is a good strategic alignment and we’re very excited about this opportunity.”
Speaking of other acquisitions that have taken place, and continue to take place in the industry, Stepe says, “I’ve gotten those calls about acquisition opportunities that are out there, and what I have seen is a lot of duplication in either products or core competencies in some of the acquisitions that have taken place. But this is really a 100% win-win because there is virtually no duplication. We have different core competencies. We are a products company and Erie has a high degree of design and complex facades systems experience. This is an expansion and coming together that serves the basic to complex levels of the market in a vertically integrated mode.
“A lot of the unitized-specific companies are still small- to mid-range and the large brands have not been historically that good at the complex facade industry. We’re looking to change that paradigm through this integration.”
Stepe adds, “And then when you mix in the vinyl [which YKK AP also offers], I see in our future that we’re not just the vinyl or aluminum company, but a multi-faceted, multi-materials facade products producer.”
What’s Next?
As far as changes that will take place within Erie AP, it’s not likely there will be anything significant. All management and staff with remain on board, and the company will continue to operate as Erie AP.
“They have a good brand name and it’s well known by customers so I don’t see any renaming,” says Stepe. “We have some high level ideas on how to scale the businesses together. We’re looking to do this in a strategic way to grow the respective businesses to a different level. To a large extent Erie AP will continue to do what it does today.”
Stepe says they will begin by focusing on executing a successful post-merger integration of the two companies.
“This is a great opportunity not only for Erie employees, but it’s great for ours as well. Erie has depth in strength and engineering, and that’s helping make this a huge success. And we’ll continue to look at other opportunities as time goes by. We believe we’ll expand Erie AP even further and grow even further and that includes facility size, operations, etc.”
Stronks adds, “We’re excited and we think this is two great brands that will form one great company.”
With the acquisition of Erie AP, YKK AP now has more than 1,000 employees in North America. In addition to its manufacturing facilities in Dublin and Macon, Ga., Cincinnati, Ohio and Dallas, the company will acquire Erie AP’s headquarters and manufacturing facility in Lakeshore, Ont.
