Controls companies merge into larger, global firms

Acquiring companies that produce and market industrial controls appears to be good business. Because the big-fish-eat-the-little-fish scenario seems to be more prevalent in this market, it can be hard to find independent, traditional controls companies. Corporate image prevails most of the time, and acquired company names are absorbed into larger firms, relegating reputations and products...

12/01/1998


Acquiring companies that produce and market industrial controls appears to be good business. Because the big-fish-eat-the-little-fish scenario seems to be more prevalent in this market, it can be hard to find independent, traditional controls companies. Corporate image prevails most of the time, and acquired company names are absorbed into larger firms, relegating reputations and products to brand names. We almost need a scorecard to track who owns who.

There are very few autonomous process control companies left, such as Moore Products. Recent acquisitions include: Elsag-Bailey (by ABB), Wonderware (by Siebe) and Keystone Valve (by Tyco). Independent discrete control manufacturers are even harder to find.

How big are the giants that digest industrial controls firms? Business Week magazine tracks the world's companies and publishes its Global 1000 report, ranking them by market capitalization. The companies listed (see table) are those most identifiable as having subsidiaries or divisions heavily engaged in marketing controls products. The portion of companies' sales in controls varies from a high of about 25% for Emerson and Honeywell to a low of about 1% for General Electric. Even so, 1% of GE, No. 1 in the Global 1000, is still a sizable amount.

U.S.-based firms make a strong showing in the Global 1000, with eight of the top 10 and 14 of the top 20. The U.S. is home to 480 of the world's top 1,000 companies, which is 33 more than on last year's list. The U.S. has more than four times as many companies as No. 2 (Japan) or No. 3 (Britain). Still, European firms comprise more than a third of the list (350), which is 54 more than last year.

In the controls field, the U.S.'s presence is even more pervasive. Of the 22 companies identified here (see chart) from the Global 1000, 17 have their headquarters in the U.S.

As market value becomes a primary measure of corporate success, the acquisitive gleam in the eyes of many giant U.S. corporations and the luster associated with industrial controls companies, is likely to fuel more mergers in the near future.

Nations with the most Global 1000 Companies

U.S.

480

Japan

116

Source: Control Engineering with data from Business Week, Global 1000 report, 1998

Britain

115

France

51

Germany

46

Canada

31

Italy

24

Netherlands

24

Sweden

22

Switzerland

20


Leading controls manufacturers

Company name

Location

Rank in home country

Rank globally

Market value (in millions)

1997 sales (in millions)

NR=not rated, *Nine months data, **Halliburton's acquisition of Dresser Industries in September will make it 102 in the U.S and 198 global
Source: Control Engineering with data from Business Week, Global 1000 report, 1998

General Electric

U.S.

1

1

271,638

90,840

Schlumberger

U.S.

56

88

38,898

10,648

Siemens

Germany

8

97

37,062

59,979

Tyco International*

U.S.

63

117

32,289

7,588

ABB

Sweden

NR

126

15,117

31,265

Emerson

U.S.

76

145

26,895

12,299

CBS

U.S.

90

173

22,800

5,363

Groupe Schneider

France

19

319

12,926

7,922

Siebe

U.K.

40

326

12,593

4,901

Halliburton**

U.S.

163

332

12,492

8,819

Rockwell Intl.

U.S.

192

399

10,808

7,762

Honeywell

U.S.

200

410

10,588

8,028

Dover Corp.

U.S.

247

516

8,362

4,548

Dresser Industries**

U.S.

253

527

8,171

7,419

Baker Hughes

U.S.

335

687

6,110

3,685

Mitsubishi Electric

Japan

90

811

5,083

27,424

Johnson Controls

U.S.

392

816

5,034

11,145

Parker-Hannifin

U.S.

429

894

4,540

4,091

ITT Industries

U.S.

445

924

4,368

8,777

Analog Devices

U.S.

472

981

4,016

1,243





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