Robert Chapman heads one of America’s most acquisitive companies, and even after 100 purchases, the CEO of Barry-Wehmiller has no intention of slowing down. He’s encouraged by the results the St. Louis-based company has been able to achieve so far with the strategy and by a current economic environment Chapman considers ripe for further acquisitions.
And Chapman told Chief Executive that more potential acquisition targets are seeking out Barry-Wehmiller as an alternative to traditional private-equity acquirers because of the company’s emphasis on continuity of operations and the sustenance of a strong internal culture.
“We did 12 acquisitions last year alone,” said Chapman, who has built $3-billion Barry-Wehmiller from a $20-million enterprise when he took over at age 30 in 1975, equating to 18-percent compounded annual revenue growth since 1990. “When you represent a culture like ours, people bring their companies to us now because they want that for their people and want to find a good steward to step in. You can’t do that with a traditional private-equity firm.”
A German division of Barry-Wehmiller, W+D, acquired BICMA Hygiene Technologie GmbH, based in Mayen, Germany, in January, notching Barry-Wehmiller’s 100th acquisition. Meanwhile over the last 43 years, the company has divested only one small concern.
“Surpassing the 100 mark is a meaningful achievement, because it shows that our strategy has been successful in dramatically reshaping our future, and creating a company with a balance of financial performance, technology, and product and market diversity that is distinct in our industry,” Chapman said in a press release.
Chapman calls acquisitions “adoptions.” He noted, “We are able to see value where others do not. With every adoption, our goal is to inspire the team to envision a better future for their people and to build a path to that future.”
Barry-Wehmiller was founded in 1885 to provide conveyance and bottle-pasteurization machinery to St. Louis’s growing brewing industry. Chapman gradually reshaped it into today’s Barry-Wehmiller: largely a supplier of engineering consulting and manufacturing technology for packaging, corrugating, sheeting and paper-converting industries.
In 2009, Barry-Wehmiller launched a hybrid equity platform, BW Forsyth Partners, new platform that has built a $600-million group of companies outside the company’s traditional markets, completing more than 20 of the 100 acquisitions.
Along the way, Chapman established, maintained and spread a nurturing and effective workplace culture that has been widely heralded, leading to his publication of the 2015 book, Everybody Matters: The Extraordinary Power of Caring for Your People Like Family.
And in the last three years, a new branch called the BW Leadership Institute has spread Chapman’s cultural approach via leadership consulting for major companies and institutions that range from American Airlines to the San Francisco 49ers of the National Football League.
Chapman initially began acquiring other companies because Barry-Wehmiller’s products were being obviated by the brewing industry.
“We only had one problem: no money or experience,” Chapman recalled. “But we began very intensely because failure would have meant death. At first we bought purely to get access to new markets and technologies. We had to buy companies that were struggling. We had to buy something that no one else wanted.”
“We are able to see value where others do not. With every adoption, our goal is to inspire the team to envision a better future for their people and to build a path to that future.”
As he proceeded, Chapman was able to add more positive criteria. One, “We needed to feel that we could make them better” as a company, which favored acquisitions that were within or complementary to Barry-Wehmiller’s eight or nine major platforms. Two, Chapman wanted to ensure that the acquisitions collectively balanced one another in terms of product and service types, technologies and returns.
“Things that sell every day, every week and every month,” he said, “in various price points and different markets so we don’t put our company at risk.”
As Barry-Wehmiller strengthened and acquired more companies, and embraced a diversity of businesses, the strong culture founded by Chapman became crucial. “It’s probably the easiest thing in the world to share our culture,” he said. “Everyone, everywhere wants to know that they matter.”
The cultural element is one that Chapman sees lacking in many private-equity firms and the acquisitions they make, and it concerns him.
“They buy a company for a dollar and need to be convinced that they can sell it for four dollars fairly quickly,” he said. “It’s not about the people. It’s purely a financial-engineering game.”
This relatively new approach by outfits that compete with Barry-Wehmiller for acquisitions reminds Chapman of the seamy side of the Industrial Revolution.
“It’s given lots of credit for creating wealth, communities, education and prosperity,” Chapman said of the Nineteenth Century phenomenon. “But it was never about human dignity and growth – only about economic gain. Nowadays again we need a human revolution that brings a balance between organizational and individual growth.”