Culligan International Company

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Culligan International Company

1 Culligan Parkway
Northbrook, Illinois 60062
(708) 205-6000
Fax: (708) 205-6030

Wholly Owned Subsidiary of Astrum International
1936 as Culligan Zeolite Company
Employees: 1,500
Sales: $190 million
SICs: 3589 Service Industry Machinery

Culligan International Company became known across the United States as the father of the soft water industry. Hey Culligan Man! was an advertising mantra nationally synonymous with conditioned water. Despite a flurry of changing ownership in the past decade, Culligans basic operations have remained virtually unchanged since its heyday. In fact, in 1995 the company was still based in the same town whose streets were first used for solar drying its key product.

Emmett J. Culligan developed a novel process for manufacturing zeolite, the man-made mineral used in water softeners, in 1936, which involved the very early use of solar drying. With a lot of confidence and a little money, Culligan approached the city council of Northbrook, Illinois, that year and offered to lease a stretch of streets. The streets had been paved, but then left unused when a real estate project went under. Several miles of empty, paved streets were just what Culligan needed for drying his zeolite in large quantities, using the sun. The council leased him the streets for $50 and a company was born: Culligan Zeolite Company.

From the start, the company was a community endeavor. Culligans first home was a shared blacksmiths shop behind the Northbrook Garage on Shermer Avenue, run by Jock Mc-Lachlan. As the operations grew, Culligan rented a brick garage building beside the blacksmiths shop and relocated the blacksmiths building to face Walters Avenue. The garage became the first manufacturing plant for portable exchange units. The office and laboratory stayed in the blacksmiths shop. Eventually, these buildings grew together, with more manufacturing space on the ground floor and offices added onto the second.

Through franchised dealers, Culligan soon launched a campaign for soft water in every home. In 1938, the first Culligan dealer started up business in Wheaton, Illinois. Growth was swift. The number of dealers bloomed to 150 by the beginning of World War II. While the war slowed growthno new dealers were signed on during that timeCulligans skills were called upon for the war effort and a facility was developed in San Bernardino, California. There, Culligan manufactured silica gel, a dehydrating material that protected metals from atmospheric corrosion. Silica gel was greatly in demand during the war and Culligan soon became one of the largest suppliers. The company was later given an award for its contributions to the war effort.

After the war, state-side expansion resumed. The dealer organization was growing again by 1946. Only a few years later, the Northbrook plant had become the largest producer of water softeners in the world. The San Bernardino facility had quickly converted and becomewith its 34 acres of solar drying basinsthe largest zeolite manufacturing plant in the world. Further plant facilities were purchased in Evanston, Illinois, not far from the Northbrook headquarters, and these were also expanding. In 1947, a two-story structure was added to the Northbrook home base.

A mere 15 years after Emmett Culligan approached the city council with $50 and an off-kilter idea, Northbrook proclaimed a Culligan Day. On October 13, 1951, a square dance and barbecue gathered the towns residents together to celebrate Culligans new half-million dollar plant on South Shermer Road. Soft water had become such a national mainstay that the old plant had suffered from eight major expansions. With the new facility, Culligan had more than 450,000 square feet of space to accommodate its sales growth.

The Culligan Zeolite Company became Culligan Incorporated in 1952. Over the decades, Culligan grew in scope, broadening its water-quality improvement offerings and branching out over the oceans. To reflect that expansion, the companys name was again changed in 1970 to Culligan International Company. Internationally, Culligan products were available through licensees in 85 countries.

In 1978, Culligan became part of Beatrice, a food products conglomerate. Beatrice later became a privately held company as a result of a buyout, and at that time a number of brands, including Culligan, were reorganized into E-II Holdings. E-II was purchased by American Brands, Incorporated, in 1988 for $1.1 billion. American Brands, a holding company with interests in tobacco, distilled spirits, and insurance, kept five of E-IFs companies and sold the rest of E-II, including Culligan and Samsonite, to the Riklis Family Corporation. American Brands had owned Culligan for about six months before it sold E-II to Riklis. About three years later, Riklis issued junk bonds and E-II fell into bankruptcy. A struggle then ensued between financiers Carl C. Icahn, who purchased senior junk bonds, and Leon Black, who purchased junior junk bonds.

Throughout this time, Culligan remained quite profitable, keeping its recipe for success basically unchanged. It had endured the bankruptcy of E-II and was still doing business and making money. In fact, Culligan did not feel many effects after the change of ownership. While junk bonds were being swapped, Culligan quietly kept at its business. In the spring of 1993, Ametek Inc. and Icahn made a bid for E-II and Culligan, but the package ultimately went to Black. After the sale, E-II became Astrum International. Culligan remains a subsidiary of Astrum, a holding company whose core businesses include American Tourister and Samsonite luggage; McGregor, a line of mens tailored clothing; and Global Licensing, which licenses trademarks.

In the summer of 1994, Culligan was an official sponsor of the Goodwill Games, which took place in St. Petersburg. At the same time, the company provided a water purification system for a group of townhomes in that city, the first American-style housing development in the Commonwealth of Independent States (CIS), formerly the Soviet Union. Culligan warmed up for this event by supplying water treatment systems for both visitors and athletes at the Olympic games in Barcelona in 1992.

In the mid 1990s, Culligans mainstay was still water treatment, and it still operated sales and distribution franchises. In fact, Culligan had changed very little over the years. From the beginning, it was one of the few water treatment companies that offered a complete water treatment line, from homes to corporations and commercial use. Most of its competitors provided either industrial or household water treatments, but not both. Culligan was able to offer that range because of its size, history, and fiscal stability. This provided Culligan with distinct advantages, because when one side of business was up, the other was often down. Company executives stated their intention to carry on the traditions begun by the companys founder in years to come.

Principal Subsidiaries

Everpure Corporation.

Further Reading

Culligan International, New York Times, June 15, 1994, p. D3.

The Culligan Man Is Splashing into Supermarkets, Beverage Industry, October 1994, p. 19.

Elliott, Stuart, Culligan International, New York Times, October 7, 1994, p. C16.

McClenahen, John, Hey, Culligan Man, Industry Week, October 17, 1994, p. 21.

Oloroso, Arsenio, Desert Calls for Culligan Man: Firm Seeks to Provide Water to U.S. Troops, Crains Chicago Business, September 3, 1990, p. 3.

Strom, Stephanie, Ametek and Icahn Join in Bid to Control E-II, New York Times, May 25, 1993, p. D5(L).

Carol I. Keeley