Sheller-Globe Corporation

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Sheller-Globe Corporation

1505 Jefferson Avenue
P.O. Box 962
Toledo, Ohio 43697
(419) 259-6000

Wholly-owned subsidiary of NEAC, Inc.
Incorporated: February 23, 1929 as City Auto Stamping
Employees: 12,000
Sales: $917 million

Sheller-Globes recently developed policy of looking outside the U.S.A. for joint ventures which will help it to utilize advanced foreign technologies is characteristic of the company. Throughout its history, and through its various mergers and acquisitions, Sheller-Globe has demonstrated an ability to survive and prosper by careful planning for the future.

Sheller-Globe was not established until 1966, but its history can be traced to the 1882 establishment of the Cincinnati-based Globe Files Company. The Corporation now supplies North American and European automotive manufacturers with parts, components and assemblies for cars, trucks and other vehicles. It also furnishes component parts and materials to other industries, including office products and accessories, microprocessor based instruments and related equipment, nuclear radiation monitoring systems and special purpose electronic components. Employing more than 12,000 people, the company has manufacturing, research and development, and warehouse facilities in 75 locations, as well as affiliates in eight countries outside the United States.

The original purpose of the Globe Files Company was to manufacture file cabinets and other office equipment. Two years after the company was formed its first catalogue was released. As business expanded into diverse areas the companys name was changed to the Globe Company.

In 1890 a New York office was opened and the company acquired a factory to manufacture office furniture and other products. By the turn of the century, the Cincinnati operation had outgrown its original facility. A new block-long building in down-town Cincinnati was constructed. At the same time the Michigan-based Wernicke Company was acquired. Wernicke, also a office supply company, was well-known for its elastic bookcase model, the predecessor of todays sectional office equipment.

The merger was an immediate success. Together, Globe-Wernicke developed the first vertical filing cabinet. This model can now be seen on display at the Smithsonian Institution in Washington, D.C. By the turn of the century, four different models of these cabinets were available.

In the early decades of the 20th century Globe-Wernicke expanded greatly. During the depression years, under the leadership of J.S. Sprott, the company persevered through ingenuity and resourcefulness. By 1939, the year Sprott died, Globe-Wernicke was already immersed in wartime production. Over 90% of its production capacity was directed toward the war effort, while peacetime items also experienced an increased demand.

In the 1950s Globe-Wernicke was acquired by the Toledo-based City Auto Stamping Company. This die maker of automotive body parts and other large stampings was founded in 1916 by Amos Lint. As an automotive engineer, Lint worked for a variety of automobile companies before he determined the need for another firm that would be completely devoted to the manufacturing of parts which automobile manufacturers could not make themselves in a cost-effective way. Products included grilles, light fixtures, console and arm rests.

In 1957 a decision was made to rename the company Globe-Wernicke Industries, Inc., with the metal office furniture and office supplies operations of the Globe-Wernicke company assuming a subsidiary position but remaining prominent. The dye making and stamping operations became the Stamping and Metal Fabrication Division which remained active until the division was sold in 1985. Further acquisitions included the Aluminum Seating Corporation of Akron, Ohio.

When a safety explosion began in the design of passenger cars and trucks in the mid-1960s, Globe-Wernicke took a close look at the Detroit-based Sheller Manufacturing Corporation. Sheller, which had begun in 1916 as a wood rim steering wheel manufacturer in Portland, Indiana, had produced the first recessed safety steering wheel and padded dash safety package offered by Ford in 1958. A merger of the two companies which took place on December 30, 1966 resulted in the Sheller-Globe Corporation, a combination with extensive complementary capabilities in metal stamping, die casting, plating, injection molded plastics, molded and extruded rubber items, and cork/rubber products.

Sheller-Globes survival, which depended upon its ability constantly to adapt to a changing environment, demanded innovation. In the case of the original merger, it was new federal safety regulations that brought about the union of two companies which independently could never have capitalized on changes in the market. The history of this newly created corporation is, in turn, the story of company mergers and takeovers.

The company was to grow substantially in 1974 through the merger of the Cleveland-based VLN corporation with Sheller-Globe. The merger substantially expanded Sheller-Globes product presence in its existing markets. VLNs Leece-Neville divisions were long established suppliers of heavy-duty alternators and related equipment to the automotive industry, and fractional horse power motors for automotive and industrial customers. Its Paramount Fabricating division in Detroit also expanded Sheller-Globes automotive product lines with stampings and assemblies, while the Accurate Parts line of starter motor components significantly strengthened Sheller-Globes position in the automotive aftermarket. Another part of VLN, Victoreen Instrument Company of Cleveland, had been a leader in developing and producing electronic components and equipment.

In 1981 Sheller-Globe acquired Radiation-Medical Products Corporation, a manufacturer of radiation medical instruments and x-ray measuring instrumentation. The acquisition of this particular company had little to do with the automobile industry, and the decision to become involved in an unrelated area reflected a new disposition to capitalize on any market that looked extremely productive. Radiation Medicals operations were therefore merged into Victoreen.

In 1982 Sheller-Globe acquired the automotive business of Detroit-based Olsonite Corporation, a manufacturer of steering wheels and injection-molded plastic parts and components for supply to the domestic vehicle manufacturers. In 1984 Sheller-Globe acquired Northern Fibre Products Company, a manufacturer of insulation and sound deadening materials and components for cars and trucks. Northern Fibres advanced technology would provide Sheller-Globe with an additional resource in the development of new materials and products for vehicle interiors.

The companys plastics manufacturing capabilities were also expanded in 1984 with the addition of the Engineered Polymers Company, a wholly-owned subsidiary that was acquired from Amoco Chemical. The subsidiary is a custom molder of structural foam cabinets for computers, word processors, work station components, communications devices, networking systems and other business machines, a proprietary line of reusable pallets for the food and pharmaceutical industries, and injection molded parts for appliances and consumer products. The acquisition would permit the use of Sheller-Globe technology in electro-magnetic and radio frequency shielding of electronic components in a promising market.

As a consequence of many of Sheller-Globes acquisitions, the automotive related divisions of the company supply an extremely wide range of original equipment parts, components and assemblies to the vehicle manufacturers. Products include thermoplastic, urethane and leather wrapped steering wheels for cars and trucks; instrument panel pads, padded consoles, arm rests and other padded components; tail lamp assemblies and a larger number of other products for vehicles.

In developing a strategy for growth during the next decade, Sheller-Globe has placed its emphasis on what it calls the team concept. In dealing with its automotive customers, the company provides a full complement of engineers and technical personnel who work closely with the automakers several years in advance of a manufacturing program.

Chester Devenow, the current chairman of Sheller-Globe, is now in his 70s, but he plans to lead the company into its next decade of expansion. The man is viewed within the industry as an executive with a talent for organizational change, as he has brought about a number of significant modifications in the structure and management of Sheller-Globe. In 1986 Devenow attempted to maximize technical and manufacturing efficiency by consolidating the operations of various units which had been duplicating functions. In addition, Devenow began to sell those businesses which were even slightly unproductive.

However, perhaps most important to the companys future was Devenows decision to enter into joint ventures with foreign manufacturers that possess technologies which do not exist in the United States. The basic strategy for future development at Sheller-Globe is to diversify within the automobile industry by merging with companies whose superior technology has no base in America. In 1985, for example, Sheller-Globe acquired a 60% interest in Etablissement Mesnel, a leading French manufacturer of auto body parts and window sealing systems whose processes had been adopted by the Ford and Mercury model cars. Even more significant to the future of the company was a joint venture with Ryobi Limited of Japan. The new entity, Sheller-Ryobi Corporation, will utilize Japanese technology in the United States to manufacture precision aluminum die castings for supply to the North American auto industry. According to industry analysts, Sheller-Globes involvement with the Japanese manufacturer will place it in an excellent position to continue its tradition of technological innovation and adaptation in a changing automobile market.

In June 1986 an investment group headed by Shearson Lehman Brothers purchased all the outstanding common and preferred shares of Sheller-Globe for $482 million. A holding company called NEAC was created by Shearson Lehman Brothers, Knoll International Holdings (the holding company for General Felt Industries), and members of Sheller-Globe management. Through NEAC, Knoll International emerged with the largest share of control. Chester Devenow retained his position as chairman and chief executive, and Alfred Grava was named president the following March.

The transfer of Sheller-Globe to private ownership invited a great deal of interest from federal authorities who suspected that arbitrageurs, particularly Ivan Boesky, had engaged in illegal speculation. Boesky allegedly profiteered through a 9.2% interest in the company when Sheller-Globe stock appreciated from $28.50 per share to $43. Nevertheless, Boesky was convicted on other charges, and the allegations of illegal activity involving Sheller-Globe were never raised in court.

Since Devenow still runs Sheller-Globe, his plans for the companys future are expected to continue.

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Sheller-Globe Corporation

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