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15-19 New Fetter Lane
London EC4A lLY
United Kingdom
Telephone: +44-20-7832-0000
Fax: +44-20-7832-0001
Web site:

Public Company
1920 as Fisher
Employees: 15,255
Sales: £1.45 billion ($2.3 billion) (2003)
Stock Exchanges: London
Ticker Symbol: FKI
NAIC: 541330 Engineering Services; 332510 Hardware Manufacturing; 333298 All Other Industrial Machinery Manufacturing; 333922 Conveyor and Conveying Equipment Manufacturing; 333923 Overhead Traveling Crane, Hoist and Monorail System Manufacturing; 334419 Other Electronic Component Manufacturing; 334514 Totalizing Fluid Meter and Counting Device Manufacturing; 334515 Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals; 334519 Other Measuring and Controlling Device Manufacturing; 335311 Power, Distribution, and Specialty Transformer Manufacturing; 335999 All Other Miscellaneous Electrical Equipment and Component Manufacturing

FKI Plc has evolved into one of the United Kingdoms major engineering groups. The companys array of some 70 subsidiaries operates in four primary business divisions: Lifting Products and Services; Logistex; Hardware; and Energy Technology products. These operations combined for a total turnover of nearly £1.5 billion ($2.3 billion) in 2003. FKI Logistex offers automated logistics and sorting products and systems for baggage handling, freight and parcel services, warehouse and distribution facilities, and manufacturers. This division, the companys fastest growing and most profitable, contributed 30.5 percent of FKIs revenues in 2003, and is one of the worlds leading logistics systems producers. Lifting Products and Services holds the worlds leading positions in lifting products and large shears, and the worldwide number two spot in chains and lifting gear, and generates more than 28 percent of company revenues. The companys Hardware division produces fittings for windows, screen and storm doors, furniture, and ergonomie hardware, holding the number one position in the United States for most of its products, and leading positions in Europe as well. That division contributed 18 percent to the companys revenues in 2003. Last, FKI, through its Energy Technology division, is the worlds leading supplier of turbogenerators, and produces a range of electrical and other power generating machinery and infrastructure equipment. That division, which focuses on the North American and European markets, produced more than 23 percent of the groups sales in 2003. FKI Pics growth has been fueled by a steady stream of acquisitions in the late 1990s and early 2000s. The company is listed on the London Stock Exchange.

From Parking Meters to Conglomerate in the 1980s

FKIs origins trace back to 1920, when the company was first registered under the Fisher name. Over the next several decades it specialized in the manufacture of parking meters, under the Karpark name. By the 1960s, the company became known as Fisher Karpark Industries. In 1973, Tony Gartland and Fred Berry took control of the company through a management buyout, ultimately changing its name to FKI Electricals. Gartlands share of the company topped 50 percent.

FKI remained a small company focused on parking meters through the 1970s. In the early 1980s, however, Gartland decided to take the company on a drive for growth. As part of that effort, the company acquired a dormant public company, Woodland Securities, which had originally operated rubber plantations in Sri Lanka. The reverse takeover enabled FKI to achieve a listing on the London Stock Exchanges Unlisted Securities Market in 1982. Joining Gartland in the quest for growth was Jeff Whalley, who had formerly worked at Babcock International, then one of the United Kingdoms leading engineering groups.

The listing enabled the company to begin making acquisitions, such as the purchase of the money-losing English Numbering Machines, part of the Rank Organisation, for £1.3 million in 1982. FKI quickly reorganized its new operations, which became profitable by the following year. The company then applied for a listing on the London main board that year.

Other acquisitions followed, including 1984s Burndept, in a cash and share deal worth nearly £3 million that extended FKI beyond its core parking meters business and into the manufacture of radio communications equipment. The companys growth accelerated in the mid-1980s, as its revenues topped £18 million in 1985. Acquisition remained at the center of the companys growth strategy, and included the mechanical engineering and components division of Thorn EMI Pic, for which FKI paid approximately £10 million in 1986. The following year the company acquired Froude Consine, which produced dynanometers and other vehicle testing equipment, before buying up Stone International for £36.6 million in July 1987. That acquisition formed the basis of the companys new air conditioning division.

Just one month later, however, FKI launched a takeover bid that was to transformat least temporarilythe company. In August 1987, FKI offered to acquire Babcock International, which, although its revenues were some seven times greater than FKIs, had fallen into financial difficulties by then. The deal went through for a total price of £416 million, and the newly enlarged company adopted the name FKI Babcock. Gartland and Whalley remained in control of the new company, which now took a place among the London exchanges prestigious FTSE 250 index.

Focusing for the New Century

Gartland and Whalley quickly hit a snag, as the stock market crash of October 1987 sent the companys share price reeling. The company continued to receive the cold shoulder from the investor communitywhich had begun to turn its back on the diversified conglomerates that had been popular in the United Kingdom in the 1970s and early 1980s. In response, FKI began a deep restructuring drive, trimming away a good deal of its Babcock side. By the beginning of 1989, FKI had shut down some 25 of Babcocks manufacturing plants.

FKI went still further in its drive to appease investors. In 1989, the company completed its restructuring by splitting the company in two. FKI Plc took over the groups core manufacturing operations, while its large-scale engineering projects division was split off into a new Babcock, which was then floated as an independent public company. FKI also planned to sell off its U.S. industrial assets, but abandoned the plan in 1990 amid the market downturn.

Unfortunately for Gartland, FKIs profits continued to struggle amid the harsh economic climate, and after posting a fresh profit dip in 1991, Gartland stepped down from the company. Whalley took Gartlands place as chairman and, in 1992, brought in Bob Beeston as CEO. Formerly part of another British conglomerate, BTR, Beeston continued the streamlining program set in place under Gartland. In December 1991, the company sold off its Stone air conditioning business, which by then had grown to four companies operating in the United States, the United Kingdom, and Spain.

As Whalley ceded day-to-day management to Beeston in the early 1990s, FKI continued streamlining its operations in order to shed its image as a conglomerate and emerge as a focused engineering group, emphasizing its operations in lifting and handling, hardware, automotive parts, and electrical engineering. By the middle of the decade, the company had built up a war chest of some £300 million and prepared a new round of large-scale acquisitions.

In 1995, the company acquired lifting specialist Amdura, based in the United States. The following year, it paid £52.3 million to acquire Italys Nuova Marelli Motori, which manufactured low-voltage electric motors and related components for forklifts and other lifting equipment. That year also, the company paid £182.5 million for Hawker Siddley, which had been operating as the Electric Power Group of BTR Pic, and also acquired furniture hardware producer Wright Products, based in the United States.

Not all of the companys expansion efforts were successfulin 1997, the company was forced to back down from a hostile takeover attempt for door fittings company Newman Tonks. In that year, also, the company exited the automobile parts market, selling off its holdings in that area. Instead, the company turned its attention to wire rope and engineering products manufacturer Bridón, which it bought for £131 million in 1997. Whalley retired the following yearbut only after making a failed £1.1 billion bid to take FKI private.

In 1999, FKI began targeting growth in a new area, that of logistics and materials handling equipment and systemsset to boom with the growth of the e-commerce market. The company began making a series of acquisitions, including Industry General Corporation in the United States, and Crisplant Industries, in Denmark, for a total of £220 million. Soon after, FKI bundled those companies together with an existing logistics and handling company, Matthew Conveyor, and created a new division, FKI Logistex. By the end of that year, the company had made another important logistics acquisition, of Pinnacle, based in the United States, for a total cash and debt cost of $425 million.

Company Perspectives

FKIs strategy is to continue to build through investment and technology, an international engineering group concentrating on specialised sectors where its businesses have strong market shares and opportunities for growth. The group is focused upon understanding the needs of customers and ensuring that it is an efficient supplier of the best products and services.

FKI Logistex, which had cost FKI some £509 million to put into place, quickly proved to be the companys fastest growing segment, a position aided in January 2000 by the purchase of U.S.-based S NE Systems, which produced integrated control systems for materials handling. By the end of that year, the company claimed the number two spot worldwide for materials handling systems, behind Germanys Siemens.

Although observers suggested that FKI, with the success of Logistex, might seek to de-merge the company again at the turn of the century, FKI remained committed to its focused, yet diversified approach, claiming that the cash flow from its hardware and turbogenerator operations enabled it to invest in gaining scale in its logistics wing. The company added to its Logistex operations, specifically materials handling, in 2001 with the purchase of Stearns Airport Equipment Co., based in the United States, and to its logistics side with the purchase of software developer Dator A/S, based in Denmark.

Not all of the companys investment went toward that division, however. In 2001, the company acquired Skoda Electrical Machines, based in the Czech Republic, for £15.2 million, which was added to its turbogenerator division. The following year, FKI acquired Germanys DeWind AG, a manufacturer of wind turbine systems, for EUR 34.5 million.

The downturn in the U.S. economy, which accounted for some 50 percent of the groups sales, exposed FKI to a drop in its market. Burdened by the heavy debt load built up during its latest acquisition drive, and further hit by the declining value of the dollar, FKI was forced to take a pause in its growth. Beeston stepped down in January 2003, replaced by Paul Heiden. By the middle of the year, FKI had been forced to shut down a number of plants, and then to slash its dividend, in order to meet shortterm payments on its looming debt. Nonetheless, the companys difficulties were seen as temporary. As it waited for the economyand businessto pick up again, FKI was able to look back on a strong record of growth, from a simple manufacturer of parking meters to an internationally operating, diversified engineering group.

Principal Subsidiaries

A Kwint Holding BV (The Netherlands; 88%); Acco Chain & Lifting Products (U.S.A.); Allen-Stevens (U.S.A.); Alvey Systems Inc. (U.S.A.); Augier SA (France); Bel with International Limited (U.S.A.); Bridón Hong Kong Limited; Bridón Inc. (U.S.A.); Bridón International Ltd; Bridón New Zealand Limited; Bridón Overseas Holdings Limited; Bridón pie; Bridón Singapore (Pte) Limited; Bridon-American Corporation (U.S.A.); Bristol Babcock Inc. (U.S.A.); Bristol Babcock Limited; Brush Electrical Machines Limited; Brush Transformers Limited; BTS Drahtseile GmbH (Germany); CERTEX Finland Oy; CERTEX France SA; CERTEX Inc. (U.S.A.); CERTEX Lifting and Service GmbH & Co. KG (Germany); CERTEX SpA (Italy); CERTEX Svenska AB (Sweden); CERTEX UK; Chautauqua Hardware Corporation (U.S.A.); CMP Corporation (U.S.A.); Crisplant Inc. (U.S.A.); Crosby Canada (Canada); Dator A/S (Denmark); Energy Technology Group; Faultless Caster (U.S.A.); FKI Engineering Limited; FKI Industrial Drives Limited; FKI Industries Canada Limited; FKI Industries Inc. (U.S.A.); FKI USA Holdings Limited; Froude Cornine; Froude-Hofmann Pruftechnik GmbH (Germany); Guangzhou Bridón Ropes and Lifting (China; 60%); Hawker Siddeley Electric Africa (Proprietary) Limited (South Africa); Hawker Siddeley Power Transformers; Hawker Siddeley Switchgear Limited; Industry General Corporation; Keeler Brass Company (U.S.A.); Laurence, Scott & Electromotors Limited; FKI Logistex; Madico Inc. (Canada); Marelli Motori SpA (Italy); Mathews Conveyor; P.T. Bripindo Utama (Indonesia); Parsons Chain Company; Premier Stampings; Real Time Solutions Inc. (U.S.A.); Rhombus Continental Castors Sdn Bhd (Malaysia); Rhombus Rollen GmbH & Co. (Germany); South Wales Transformers; Stearns Airport Equipment Company (U.S.A.); Truth Hardware Corporation (U.S.A.); Weber-Knapp Company (U.S.A.); Welland Forge (Canada); West House Insurance Limited; Whipp & Bourne; Wright Products (U.S.A.).

Principal Divisions

Lifting Products and Services; Logistex; Hardware; Energy Technology.

Key Dates

Fisher, predecessor to FKI, incorporates in London and becomes a specialist in manufacturing parking meters.
Tony Gartland takes over Fisher Karpark Industries, as the company is then called, in a management buyout.
FKI goes public on the London secondary market through a reverse takeover.
FKI switches its listing to the London main board and begins an acquisition drive.
FKI acquires the larger Babcock International and becomes FKI Babcock.
FKI restructures, splitting off heavy engineering assets as the publicly listed Babcock.
FKI begins a new acquisition drive with the purchase of Nuovo Marelli Motori of Italy and BTRs Electric Power business.
FKI sells its automotive division and acquires Bridón, a maker of cable rope and lifting equipment.
The company acquires Industry General in the United States and Crisplant in Denmark to add to its logistics and handling operations.
The company acquires Pinnacle in the United States and then sets up a new Logistex division to group all of its logistics and handling equipment and systems businesses.
The company acquires Stearns Airport Equipment Co. (U.S.A.) and Dator (Denmark) for Logistex, and Skoda (Czech Republic), a producer of turbogenerators.
The company acquires DeWind AG (Germany), a maker of wind turbines.
The company is forced to slash dividends in order to make interest payments on its debt load.

Principal Competitors

Siemens Dematic; Daifuku Co., Ltd.; Schaefer Holding International GmbH; Columbus McKinnon Corporation; Swisslog; Murata Machinery Ltd.; Dexion Group Ltd.; Vanderlande Industries, B.V.; Jervis B. Webb Co.

Further Reading

Downgrade Sparks Profit Taking, Financial Times, June 25, 3003, p. 44.

Edgecliff-Johnson, Andrew, FKI Prepared for Acquisitions, Financial Times, June 17, 1998, p. 21.

FKI Finds a Strategy for Tackling Problems, Birmingham Post, November 22, 2002, p. 24.

Gimbel, Florian, Focus on Logistics Bolsters FKI, Financial Times, June 1, 2001, p. 23.

Mathieson, Clive, FKI Issues Growth Plan After Investing Pounds 500m, Times (London), June 2, 2000, p. 33.

White, Dominic, Could Engineer a Comeback, Daily Telegraph, April 2, 3004, p. 34.

M.L. Cohen