United States Filter Corporation
United States Filter Corporation
Sales: $1.367 billion (1997)
Stock Exchanges: New York
SICs: 3569 General Industrial Machinery, Not Elsewhere Classified; 8711 Engineering Services; 3589 Service Industry Machinery, Not Elsewhere Classified
United States Filter Corporation (USF) is the world’s largest and fastest-growing water and wastewater treatment company. Founded in 1953, it was once a regional company with less than 500 employees in the United States and annual revenues of less than $30 million. USF has since grown into a worldwide industry leader with more than 10,000 employees, annualized revenues of $1.36 billion and operations on every continent with customers such as Coca-Cola, Chrysler, and 3M.
Since 1991, USF has acquired and integrated more than 100 companies worldwide including many of the oldest, most-respected names in the water and wastewater industry. These acquisitions have enabled USF to greatly increase its presence in those industries, to expand its worldwide service in all of the markets it serves, and to build its installed base, service network and range of products and technologies.
In 1991, USF obtained Lancy Environmental Systems, a leader in industrial wastewater treatment, metals removal and recovery, advanced biological treatment, and landfill leachate treatment systems. January 1992 brought USF Illinois Water Treatment, a Rockford, Illinois-based leading water treatment equipment manufacturer that specialized in high-purity technologies such as ion exchange (IE), reverse osmosis (RO), and ion exchange resin processing and Metro Recovery Systems, a Roseville, Minnesota-based RCRA Part B-permitted hazardous waste and recovery facility. In April of the same year, USF acquired Societé des Ceramiques Techniques, a Tarbes, France-based world leading fabricator of advanced ceramic materials and Membralox ceramic membranes.
In January 1993, USF acquired Permutit, a Warren, New Jersey-based pioneer in water and wastewater treatment technology with expertise in evaluating, designing, engineering, and building systems. In December of the same year, USF acquired lonpure Technologies Corp., a Lowell, Massachusetts-based manufacturer and service provider of ultrapure water systems based on RO, ultrafiltration (UF) and “continuous deionization” technologies, as well as service deionization (SDI) services, laboratory water systems and replacement cartridges.
Speeding up Acquisitions, 1994-96
May 1994 took USF to Barcelona, Spain, where it acquired Sation S.A., a company which primarily services ultrapure water purification products, specializes in SDI and auto-deionization equipment for the general industrial market. In June, USF acquired Sanila S.A., an Amboise, France-based company specializing in SDI and auto-deionization equipment for the automotive, aeronautics, semiconductor, pharmaceutical, and power markets.
July brought USF a company called Continental Water Systems, a manufacturer of ultrapure water systems based on RO, UF, and IE cartridges that also provides SDI for laboratory and medical markets. Also acquired that same month were Penfield Corporation, a leading manufacturer of customized high-purity water systems for pharmaceutical applications; Ransbach-Baumbach, Germany-based Seral Erich Alhauser GmbH, the largest provider of SDI in Germany which also designs, manufactures, installs, and services water purification products and systems for laboratory and commercial markets; and Liquipure Technologies Inc., which provides SDI products and services through company-operated and franchised dealers and designs, manufactures, installs, and services ultrapure water purification products and systems primarily for the pharmaceutical and laboratory markets.
In August, USF bought Ceraflo(r) Products, a part of Millipore Corporation, a leader in the manufacture of ceramic membrane filters used in the pharmaceutical and beverage markets; and Smogless S.p.A., a Milan, Italy-based provider of a broad range of services for wastewater treatment, including feasibility studies, process evaluation, plant design, construction, and commissioning and design of specialized machinery which also specializes in custom turnkey industrial treatment plants.
In December, the company acquired Group Crouzat, a TouIpuse, France-based developer and distributor of water purification products for industrial and laboratory customers and the French industry leader in SDI; and L’eau Claire, an industry leader for over 30 years in upflow media filtration for the petroleum, power, chemical and plastics markets.
April 1995 brought USF another Permutit holding, this time The Permutit Group, a Hertford, England-based pioneer in water and wastewater treatment technology with expertise in evaluating, designing, engineering, and building systems and a major provider of SDI services in the United Kingdom, Australia, and New Zealand which produces custom and standard water treatment products for the pharmaceutical laboratory and chemical markets. In May, USF acquired Arrowhead Industrial Water Inc., a supplier of owned and operated onsite industrial water treatment systems in the United States and provides emergency and temporary mobile water treatment systems. USF, in August, acquired Interlake Water Systems, a Broadview, Illinois-based provider of water treatment services, including SDI, in Illinois and Michigan that also sells and services a broad range of complex water treatment systems. In October, USF acquired Polymetrics Inc., a provider of treatment systems and services for the electronics, pharmaceutical, laboratory, power generation, and cogeneration industries and also provides water treatment services, including SDI. November brought USF Home Waterbehandeling B.V., a Zoetermeer, Netherlands-based provider of SDI, IE, and wastewater treatment systems for metal finishing and general industry and Houseman B.V., a Bergen op Zoom, Netherlands-based provider of water treatment systems for the power and petrochemical markets. Bekox, a Madrid, Spain-based provider of large RO and biological wastewater treatment systems to the general industry market was obtained in December.
January 1996 saw USF acquiring Jet Tech, an Edwardsville, Kansas-based manufacturer of products which are used to enhance the biological destruction of organic contaminants using high-efficiency air diffusion and mixing with sequencing batch reactors and aerobic digesters which treat sludge and biosolids for land applications or landfilling without restrictions; and Ponzini Acque Sd (Italy), a Soresina, Italy-based company which provides water treatment for pharmaceutical industry applications.
The next month, USF acquired KBS Pure Water Ltd. of Singapore and KBS Pure Water Sdn. Bhd. of Penang, Malaysia, both of which provide a variety of water treatment equipment and services including SDI, water purification equipment and wastewater equipment to microelectronics manufacturers and other industrial customers in Asia; Wastewater Treatment Systems, a designer and assembler of wastewater treatment systems specializing in microelectronics, wastewater treatment, and recycle systems; and, continuing to eat away at the Permutit companies, USF acquired in the same month Permutit (Egypt) Ltd., a company which designs water treatment systems used primarily in the Middle East and whose facility also added seawater desalination and potable and wastewater treatment technologies to the company’s product offerings.
In March, USF acquired Sagei Electropure, a provider of SDI and RO systems in the dialysis market. May brought USF Posey Pure Corporation, the Houston, Texas-based leading provider of SDI in that city’s market and Zimpro Environmental Inc. and Enviroscan Inc., Rothschild, Wisconsin-based manufacturers of wastewater treatment equipment using proprietary technologies in wet oxidation, landfill leachate systems, groundwater remediation, filtration and sludge treatment systems, and providing environmental analytical services for water, wastewater, soils, sludges, and air, including analyses required for priority pollutants, safer drinking water, and landfill monitoring and remediation projects.
In July, USF acquired Coyanosa Product, a distinctive oil and water separation process by means of walnut shell filtration and Xentex Corporation, a provider of SDI, water purification systems, and regeneration services in Kansas and Missouri. August brought USF two businesses: Davis Water and Waste Industries, a leading distributor of water and wastewater distribution products and services to the industrial and municipal markets which also designs, engineers, manufactures and installs water and wastewater treatment and pumping equipment; and Viking Water Systems, a leading provider of drinking water treatment and bottling equipment.
In September, USF acquired Kisco Water Treatment Company, a Greendale, Wisconsin-based manufacturer of water treatment equipment for the industrial and commercial markets that offers a full range of standard and custom-engineered products including softeners, filters, deionizers, dealkalizers, condensate polishers, degasifiers and RO equipment; and Marga Chemical & Industrial Corporation, a Philippines-based manufacturer of water treatment equipment for the industrial and commercial markets with a full range of softeners, filters, deionizers, and dealkalizers and whose services include installation, maintenance, and SDI.
The cycle of water —the conversion of moisture as it evaporates and rises to form clouds that release rain to Earth once again —brings infinite promise. Although nature’s management system creates deserts and floods, it delivers one of Earth’s most precious assets on a scale that defies imagination. This cycle is an implicit warning that, as the population of Earth grows, change must occur in the way the world uses water. That change is U.S. Filter’s mission.
The following month saw USF obtaining Norris Environmental Service, an RCRA Part B-permitted hazardous waste treatment and recovery facility; The Utility Supply Group Inc., a Waco, Texas-based leading distributor of water and wastewater distribution products and services to the municipal market primarily in Texas, California, and Florida; and WaterPro Supplies Corporation, a leading distributor of water and wastewater distribution products and services to the industrial and municipal markets within the U.S. November brought USF Akvapur AB, a Stockholm, Sweden-based engineering firm specializing in power applications with technologies including flocculation, media filtration, softening, IE, and condensate polishing; and Perrier Equipment S.A., a company involved in sales, engineering, and manufacturing for industrial process water purification and effluent treatment, filtering screens, intake systems and flow control for dams, canals, and irrigation ditches and municipal wastewater treatment.
USF, in December, acquired the Water Systems and Manufacturing Group (WSMG) of Wheelabrator Technologies Inc. (WTI) for $369.6 million in cash. This acquisition strengthened USF’s technological capabilities and product offerings, particularly in the municipal and industrial wastewater markets and expanded USF’s engineering and manufacturing capabilities outside North America, especially in Europe and Asia, where WSMG generated approximately half of its 1995 revenues. WSMG products and systems include EVAP, IX/ER, Mem-clean, RMS, and Totaltreat.
As part of the WSMG package, USF ended up acquiring The Wheelabrator Corporation, a Naperville, Illinois-based designer and manufacturer of environmentally sound surface-cleaning and preparation equipment and supplies and a producer of metal screening and grating used in wastewater and organic and inorganic waste handling; USF CPC Engineering, a designer of water and wastewater treatment systems for municipalities on a standard or custom-engineered basis under the Microfloc brand name and a producer of solids screening, dewatering, conveying, and grinding equipment for municipal and industrial applications; Darchet Engineering, a specialist in water and waste-water needs of the microelectronics, metal finishing, and other industries in the Pacific Rim region and also a specialist in IE, RO, UF, and conventional technologies; HPD, a leader in evaporation and crystallization water treatment technologies serving the pulp and paper, chemical, petrochemical, mining, and power industries which enhanced USF’s zero-discharge and product recovery techniques; Johnson Screens, a recognized leader in well screen design and development and screen installation with operations in Minnesota, France, India, and Australia; Memtek, a maker of sophisticated cross-flow membrane microfiltration products to remove inorganic solids and heavy metals from contaminated wastewater for the microelectronics, metal finishing and industrial laundry marketplace; PSS, a Spain-based provider of evaporation, crystallization and membrane separation technologies primarily in the chemical and pulp and paper industries; Sun Chi, a Taichung, Taiwan-based designer and installer of wastewater treatment systems primarily for municipal applications; and Westates Carbon, a full-service granular activated carbon company that provides USF with the ability to recycle and reuse spent carbon used in both water and wastewater treatment applications.
The same month, USF acquired Didier Gutling GmbH, a Stuttgart, Germany-based metal finishing sales and systems engineering company; Effimex, S.A. and Sitindustrie S.p.A., manufacturers of well screens; and RECON Verfahrenstechnik GmbH, a metal finishing company specializing in the galvanizing industry with IE and metal recovery capabilities.
First Billion-Dollar Water Treatment Company, 1997
In 1997, USF became the United States’ first billion-dollar provider of industrial and municipal water and wastewater treatment systems, products and services. Fortune magazine ranked USF among the 100 fastest-growing companies in the world, with compound annual revenue growth of 66% between 1991-96.
In January, USF acquired the Process Equipment Division (PED) of United Utilities Plc for approximately $160 million in cash and over one million shares of USF common stock, providing USF with a significant manufacturing and distribution presence in the municipal wastewater treatment equipment and systems market, primarily in North America and Europe. Included in the acquisition were several PED units, among them Edwards & Jones, a designer, manufacturer, and installer of biosolids handling equipment primarily for municipal markets in Europe and the Pacific Rim region; Asdor, also a designer, manufacturer, and installer of biosolids handling equipment in North America; Envirex, a leading manufacturer of wastewater treatment equipment, including screening, grit removal, biological treatment, and solids collection equipment with particular strengths in the municipal treatment market, with one of the world’s largest installed bases of municipal wastewater treatment equipment and broadest product lines; and Wallace & Tiernan, the Vineland, New Jersey-based world leader in the manufacture of water and wastewater disinfection systems and components and the inventor of the chlorine gas purification technologies in 1913.
Also as part of the PED purchase, USF acquired Consolidated Electric, a St. Paul, Minnesota-based supplier of automation and control systems for municipal water and wastewater treatment equipment using liquid level pressure and flow sensors, automatic pump controllers, and alternators and remote control technology; and General Filter/Acumen, leading providers of pretreatment equipment, granular media filtration systems, and microfiltration systems, primarily to the municipal water markets in North America. Acumen also sells microfiltration systems for the treatment of surface and ground water to potable water standards for industrial and municipal users in the U.S., U.K. and Australia.
Other acquisitions in January included Geopure Systems and Services Inc., a provider of SDI in Florida, Alabama, Texas and Virginia; and an SDI provider called Technipure Inc. The following month brought USF Lazers H2O Inc., a supplier of high-purity water systems to the medical, pharmaceutical, biotechnology, and electronics industries servicing Minneapolis (whose facility contains a high-purity water ion exchange resin regeneration plant which is registered with the U.S. Food and Drug Administration as a medical device manufacturer), as well as North Dakota, South Dakota, Iowa, and Wisconsin; and PORI International Inc., a Baltimore, Maryland-based company that designs, installs, operates and services wastewater treatment for large industrial customers, including steel and aluminum manufacturers.
USF, in March, acquired Cass Corporation, a manufacturer of mobile surface preparation equipment; a water distribution company called Lone Star Water Inc.; Sidener Supply Company, a leading distributor of waterworks equipment, supplies, and services with 15 facilities in Illinois, Indiana, Kansas, and Missouri; and a supplier of high-efficiency hydrocyclone oil/ water separators called Trident Separation Technologies.
April brought a number of companies under the USF umbrella. Continuing to buy up Wheelabrator Technologies, USF acquired Wheelabrator EOS Inc., another Naperville, Illinois-based segment which was the contract operations and privatization businesses of WTI in exchange for over two million shares of common stock. WTI is a provider of water and wastewater treatment maintenance and operation services for over 130 clients. WTI also is developing privatization initiatives for municipal wastewater treatment facilities and, in 1995, became the first company in the United States to acquire a publicly owned wastewater treatment plant under Executive Order 12803.
During the same month, USF acquired United States Water Company Inc. (USW), a Cedar Rapids, Iowa-based network of 20 service branches that serve residential and commercial water treatment markets, mostly in the Midwestern U.S. and Florida, in exchange for approximately 500,000 shares of common stock. This acquisition gave USF a strong entry into the residential market of bottled water, water softeners, and whole-house and household point-of-use water treatment products and systems. However, the acquisition triggered a lawsuit by Culligan Water Technologies against USF when USW terminated all agreements with Culligan. Culligan alleged USW violated franchise agreements with Culligan and the possible passing of confidential Culligan information from USW to Culligan competitor USF.
April also saw the acquisition of Adaline Water Systems Inc. in Dallas and Bedford, Texas, a company which provided self-service bottled water and bottled water delivery as well as residential and commercial water softening products and drinking water treatment systems; Chester Engineers Inc., an engineering firm specializing in the metals, design-build, and automotive industries; Dan Little Water Marts #44 and #45, retail water stores located in Waco and Temple Texas, which provide self-service bottled water and bottled water delivery, as well as residential and commercial water softening products and drinking water treatments; Florida Springs Distribution Inc., a residential and commercial bottled water distribution company; and Pure H2O Inc., two West Palm Beach, Florida-based retail water stores offering self-service bottled water and bottled water delivery for the residential and commercial markets.
The following month, USF purchased Gene McVety Inc., a wastewater distribution company with operations in Phoenix, Arizona; J. Mortensen & Co. Limited, a manufacturer, distributor, and service provider of a broad range of water and wastewater equipment for the industrial, commercial, and municipal markets of Hong Kong, Taiwan, and China; Mobley, a Bay-town, Texas-based company that specializes in the collection, treatment, recycling, and management of a wide range of non-hazardous oil/water and fuel/water mixtures, used oil filters, antifreeze, and other related materials; Southwest Abrasives & Equipment Co., a surface preparation sales, service, and distribution company; and Trinity Coast Sales Incorporated, a distributor of residential and commercial bottled water located in Colleyville, Texas, that offers water in both natural spring and purified forms and distributed under the Coral Springs label. In June, USF acquired Fife, a wastewater distribution company with operations in Florida, South Carolina, and Mississippi.
Near the end of 1997, USF’s owned or operated facilities processed nearly 600 million gallons of water per day and its products could be found in more than a quarter million customer facilities, making it the only company in the world with the ability to design, manufacture, install, service, maintain, operate, finance and own nearly every product, service, and technology required to process, treat or distribute industrial, municipal, or residential water and wastewater. With no sign of slowing its growth, USF far outstrips leading competitors in many industries, including Culligan, Sparkletts Water and Crystal Water, Osmonics Inc., Calgon Carbon, RainSoft Water Treatment Systems, and Air Sep Corporation.
General Filter Company; Illinois Water Treatment Co.; lonpure Technologies Corp.; Permutit Company Inc.; Polymetrics (France); Seral Erich Alhauser GmbH (Germany); Smogless SpA (Italy); U.S. Filter Asia (Singapore); U.S. Filter Europe (Spain); U.S. Filter Mexico (Mexico); Xentex Corporation.
“Absolute Control: Invest Where You Have the Knowledge and the Edge, In Yourself and Your Industry,” Success, —June 1997, p. 17.
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“$46 Million Stock-and-Debt Bid for Utility Supply,” New York Times September 7, 1996, p. 21.
Holden, Benjamin A., “U.S. Filter Hopes Acquisitions Can Keep Profits Flowing; Water Concern Agrees to Deal with WMX Technologies; Stock Surges to 15%,” Wall Street Journal, September 23, 1996, p. B4(E).
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—Daryl F. Mallett