Vol. 62 No. 1 A Hearst Business Publication January 14, 2013 $4
FLOOR COVERING WEEKLY
Periodical
By Raymond Pina
[Glen Burnie, Md.] Haines’ Jan. 3
acquisition of Baltimore-based sundries
distributor Allied Products is the latest
move in the company’s two-pronged plan
to expand its territory and diversify its
business, according to president and CEO
Bruce Zwicker.
In 2007, Haines began to implement
its plan by expanding into the Southeast
with the acquisition of Florida-based
Wheeler and the subsequent additions of
warehouses and sales teams in Georgia
and South Carolina. Now, the purchase of
Allied kicks off phase two and the development
of “separate but complementary”
businesses, according to Zwicker.
“Allied complements our fl ooring business
but it’s diff erent than fl oor covering
distributing,” said Zwicker. “Where we
focus on selling fl oors to dealers, Allied sells
tools, sand paper, tack strips and adhesives
to installers. We also sell adhesives, but to
fl oor covering dealers, so reaching installers
is an entirely new market and that’s the
diversifi cation we’re seeking.”
Allied’s vice president Eric Davison, president Bob
Davison and senior vice president Ken Wells.
Allied acquisition feeds
Haines’ aggressive growth plan
While Allied’s territory overlaps with
portions of Haines’ Mid-Atlantic footprint,
it will continue to service installers as a
separate business unit from its existing 11
locations throughout New Jersey, Maryland,
Delaware, Pennsylvania, Virginia,
West Virginia, North Carolina and the District
of Columbia. Haines covers the Eastern
Seaboard from New Jersey to Florida as well
as eastern Kentucky.
Though Haines and Allied will merge
accounting and computer systems, Allied
will maintain all of its employees and continue
operating independently, according
to Zwicker. “The Allied name stays. All of
the employees stay. All of their locations
stay. And the management stays. So there
will be very little change,” he emphasized.
Allied senior vice president Ken Wells
also noted the importance of the two
companies continuing to run separatel y.
“It wouldn’t work otherwise,” he said. “A
lot of distributors have tried to get into
sundries but it doesn’t work unless you
have separate sales forces. A guy selling
$500,000 in wood doesn’t care about the
Continued on page 34
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PRE-SURFACES
ISSUE 2013
Engineered
for the future
Carson says execution key to growth
By Amy Joyce Rush
what’s next,” he said.
Carson replaced retiring
[Orlando, Fla.] It’s been a busy
Frank Peters last year. Coming
year for Mohawk Flooring, according
from the operations side, he said
to president Brian Carson. In his fi rst
that much of his time is spent on
year in the position, the company
planning and execution — how
launched SmartStrand Silk, Wear-
to keep the company running
Dated Embrace nylon, acquired
eff ectively and effi ciently.
Pergo and Marazzi and initiated a
For example, through its many
number of new marketing programs. Brian Carson
acquisitions over the years, some
Carson said that while managing
of Mohawk’s teams are scattered
all of the current carpet initiatives, he’s sure to in diff erent locations. But that is changing as
keep his eye on the future. “I make sure that Carson looks for better solutions for the com-
myself and key leaders fi gure out what’s next pany. So much of the key Mohawk Flooring
— product, merchandising systems, market- management, he said, will be moved to Caling
— we’re spending time to think through
Continued on page 34
Marazzi deal furthers global reach
By Tanja Kern
[Calhoun, Ga] Mohawk Industries
will acquire Italian ceramic tile maker
Marazzi Group for $1.5 billion during
the fi rst quarter of 2013, pending
closing and regulatory approvals.
“Th is acquisition represents
the next step in the expansion of
Mohawk’s global business and will
make Mohawk a stronger company,”
said Jeff Lorberbaum, Mohawk’s chairman
and chief executive offi cer. “We found
Marazzi attractive because of its solid management
team and leadership positions in the
U.S., Russia and Europe. Th e combination of
Mohawk and Marazzi creates opportunities to
expand U.S. distribution through service centers
and other channels, source ceramic from
our worldwide assets, utilize our relationships
to expand all product categories and deploy
leading innovation and design trends to all of
our ceramic businesses around the globe.”
Th e Marazzi family currently owns 51 percent
of the group. Th e family and investment
fi rms Permira and Private Equity Partners
took the company private in 2008 with a
transaction valued at $1.1 billion at the time.
Jeff Lorberbaum
Marazzi, which employs 6,300
people, had revenue of $1.16 billion
in 2011, Mohawk said. Marazzi
sales are up 4 percent for 2012, and
earnings before interest and taxes,
depreciation and amortization will
total about $191 million this year.
Mohawk reported 2011 sales of $6.6
billion, up 16 percent from 2010.
“Th e partnership with Mohawk
represents a great development
opportunity for Marazzi Group,” said
Marazzi Group CEO Andrea Sasso. “It combines
Marazzi’s leading brand, innovation
and technological leadership with Mohawk’s
leadership in the overall fl ooring industry
and distribution strength.”
Mohawk leadership noted several benefi ts
to the acquisition during a conference call on
December 21, 2012. Worldwide consumption
of ceramic tile is estimated to be more
than 110 billion square feet. Marazzi Group
distributes tile in more than 100 countries,
and global demand for ceramic tiles is growing
by 5 percent to 6 percent a year. Sales
outside of North America will represent 29
percent of total Mohawk sales.
Continued on page 30
8
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