by Aaron Hackle
January 4, 2017
In the past few years, major producers of industrial fasteners have completed a number of acquisitions and divestitures that reflect the size and competitive environment of the global industrial fastener market. According to Elliot Woo, analyst with The Freedonia Group, this trend is expected to continue, with the industry anticipated to become more concentrated as manufacturing, product development, marketing, and distribution costs continue to climb.
Leading industrial fastener suppliers have used acquisitions to broaden their product portfolios to include new products and strengthen their position in specific market categories. For example, the largest recent acquisition in the fastener industry was Berkshire Hathaway’s $37.2 billion purchase of Precision Castparts Corporation (PPC) in January 2016. PPC, a worldwide diversified manufacturer of complex metal products, was the world’s second-largest fastener supplier behind Illinois Tool Works. One of the primary reasons for the takeover was PPC’s position as a leading American exporter of fasteners for the global aerospace market. Combined with revenues generated by its Marmon Holdings subsidiary, Berkshire Hathaway is now the world’s largest supplier of fasteners.
In September 2016, Italy-based Agrati acquired ContMid Holdings (CMG), a U.S.-based manufacturer of metal fasteners for automotive applications, from Monomoy Capital Partners. Agrati already had strength in the automotive sector and purchased CMG specifically to create one of the world’s leading suppliers of automotive fasteners.
Acquisitions allow fastener manufacturers to extend their geographic reach into developing markets. For example, in September 2015, Italy-based Fontana Luigi acquired a majority stake in India’s BG Fastening & Engineering Industries, a maker of fasteners for the automotive sector.
In December 2015, Germany’s Böllhoff strengthened its presence in the Italian automotive market with the purchase of Unifast. In July 2016, ITW purchased the Engineered Fasteners and Components business of ZF Friedrichshafen (Germany). The acquired business manufactures engineered fastening systems and interior technical components for the motor vehicle OEM market, operating approximately 15 production facilities throughout Europe, North America, and the Asia/Pacific region. The ITW/ZF Friedrichshafen is also notable because it was an instance of a firm (in this case ZF Friedrichshafen) with a peripheral or secondary interest in the fastener industry disposing its fastener operations in order to focus on its more profitable or core businesses.
For further information, see The Freedonia Group’s study Global Industrial Fasteners Market, 9th Edition. This comprehensive industry study analyzes the $69.6 billion global industrial fastener industry, presenting historical demand data and forecasts by product and market. The report also evaluates company market share and offers competitive analysis of industry competitors.
Aaron Hackle is a Corporate Analyst at The Freedonia Group, where he works on studies related to the US and Global chemicals, industrial components, and oil and gas markets.
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