Ekco Products Company
The Edward Katzinger Company was founded in 1888 by Edward Katzinger. This Chicago-based company manufactured tin pans for commercial bakeries. In the decade that followed its establishment, the company’s products included equipment for confectioners, ice cream manufacturers and bakeries. It was incorporated in 1903 under the name Ekco Products Company, and three years later, it erected a five-story building.
The company purchased August Maag Co., a Baltimore firm that manufactured bakery equipment, in 1927. Two years later, the company purchased the A & J Manufacturing Company, the largest manufacturer of kitchen tools and equipment. This acquisition signaled the company’s entry in the kitchenware business. In 1945, Ekco Products Company went public.
Beginning in the 1930s, Ekco experienced robust growth well into the 1960s by means of various acquisitions. It acquired the Geneva Cutlery Co. in 1934, and in 1937, formed an English subsidiary called Platers and Stampers, Ltd., a company that manufactured domestic utensils. Ekco had a controlling interest of 69% in this company. Sta-Bright Products Corp., a manufacturer of stainless cutlery was purchased by Ekco in 1943. In 1945, Ekco acquired E. L. Tebbets Spool Co., a manufacturer of various household articles like wooden handles, rolling pins, spools and toy parts. Also in 1945, the company acquired Massillon Aluminium Co., a cooking utensils manufacturing company. The net sales figure soared from $5.4 million in 1938 to $19.5 million in 1944, and the net income rose from $357,000 to $1.06 million.
Ekco acquired several more companies in the decade after the Second World War. It purchased Murdock Metal products, Byesville Products Co., Bergen Forge Co., Diamond Silver Co., Minute Mop Co., Republic stamping and Enameling Co., Adams Plastic Co.,
In 1947, Ekco created a Canadian subsidiary, and in 1948, formed a Mexican subsidiary. The National Glaco Chemical Co. was formed by Ekco in 1949 for the treatment and coating of commercial baking pans. Ekco formed Prudential Housewares, Inc., also in 1949, to engage in house-to-house selling. By the end of the 1950s, it was said that Ekco’s dominance over its market was such that it produced almost 65 percent of all kitchen tools and 40 percent of all kitchen and table cutlery.
The company’s principal brand names by 1960 were Ekco, Ekco Eterna, Ekcoloy, Ekco-Autoyre, Flint, Geneva Forge, Waverly Edge, Berkeley, Kennatrack, Worley, McClintock, and Pakkawood. Net sales increased from $31.5 million in 1950 to $85.2 million in 1960. The net income rose from $2.9 million in 1950 to $4.8 million in 1960.
During this period, the company diversified its field of operations. It established Ekco-Alcoa Containers, Inc., in 1955 with the Aluminum Co. of America (Alcoa). In 1962 Ekco bought out its partner’s interest in the company and changed the name of the company to Ekco Containers, Inc. It formed an aluminum-foil container company in Denmark in 1963, in a joint venture with Haustrups Fabriker Co.
Ekco Group Inc., produces and markets a wide range of household products under its own name and under the brand names it owns. Its products include kitchen and bakery utensils, molded plastic products, pest-control and animal-care products. In the mid-1990s, Ekco advertized itself as the biggest supplier of kitchen tools and gadgets, and a major supplier of metal bakery products in the United States.
Edward Katzinger, a skilled tinsmith, emigrated from Austria to New York City in 1881 at the age of 18. He worked as a master mechanic in a New York tinsmith shop for some years. Then in 1888, quitting the job that paid him $25 a week, he left for Chicago to open a business of his own. This concern was named the Edward Katzinger Co., and its business was the manufacture of tin pans for commercial bakeries. The company made profits right from the beginning, and by 1899, its line of business included equipment for confectioneries, ice cream manufacturers and bakeries. The flourishing company built a five-story building in 1906, and a seven-story addition was made in 1913.
Edward Katzinger’s son Arthur was born in 1894. He was a difficult child who was expelled from high school for his ungovernable behavior. He was sent away to a military school from where he returned changed and disciplined. He earned a mechanical engineering degree in 1916 from the Armour Institute (which later became the Illinois Institute of Technology), where he was a star athlete, captaining the football, basketball and track teams. Arthur then started working for his father as plant manager in the company. After the death of an older brother in 1919, his father asked him to take up the reins of the company. Arthur later recalled that he “took me out of the factory and told me to run the company.”
The Katzingers had a new, modern two-story factory built on Chicago’s northwest side in 1923. In the next 35 years, Ekco became the largest manufacturer of non-electric housewares through a series of acquisitions. The August Maag Co., a small bakeware manufacturing firm based in Baltimore was the first of its 35 acquisitions. In 1929, Ekco purchased the A & J Manufacturing Co. of Binghamton, New York and marked its entry in the kitchen utensils business. In the first three years of the Great Depression, the company moved A & J’s operations to Chicago. It dismantled the Baltimore plant and built a new one modelled after its Chicago plant. The business expanded and the earnings tripled.
Arthur Katzinger became the president of the company after Edward Katzinger’s death in 1939. The company went public in 1945 under the name Ekco Products Co., where E & K stood for the initials of the founder. By this time, Arthur had changed his last name to Keating, and had taken up the title and duties of Chairman of the Board.
Ekco kept up its aggressive acquisition policy and continued to grow. In 1934, it acquired Geneva Cutlery Co. of Geneva, New York. In 1937, Ekco formed an English subsidiary, Platers and Stampers, Ltd., in which it had a controlling interest of 69 percent. It purchased Sta-Bright Products Corp., a New Haven, Connecticut business that manufactured stainless-steel cutlery in 1943. In 1945, it purchased E. L. Tebbets Spool Co., of Locke Mills, Maine. This company was a manufacturer of wooden handles, rolling pins, spools, and toy parts. Also in the same year came the acquisition of an Ohio producer of cooking utensils, the Masillon Aluminum Co. Ekco’s aggressive aqcuisitions paid off, and the company’s sales and income soared upwards. From $5.4 million in 1938, the net sales went up to $19.5 million in 1944. The net income rose from $357,000 to $1.06 million in this period.
Ekco went public in 1945, and the funds that came in enabled the company to make acquisitions at an even more vigorous pace in the first ten years after World War II. Some of the companies acquired by Ekco were Murdock Metal Products Co. of Chicago; Shore Machine Corp. of New York City; Byesville Products Co. of Byesville, Ohio; Autoyre Co. of Oakville, Connecticut; Bergen Forge Co. of Bergen, New Jersey; Adams Plastic Co. of Holyoke, Massachusetts; Diamond Silver Co. of Lambertville, New Jersey; Republic Stamping and Enameling Co. of Canton, Ohio, and Minute Mop Co. of Chicago. Ekco established a Canadian subsidiary in 1947, and a Mexican subsidiary in 1948. It also established the National Glaco Chemical Co. in 1949, a company for the treatment and coating of commercial baking pans under a new process. Ekco formed a house-to-house selling company, the Prudential Housewares, Inc., in 1947. The name of this organization was later changed to Ekco Products Co. By the late 1950s, Ekco was considered the leading manufacturer of household items, with about 65 percent of kitchen tools and 40 percent of all kitchen and table cutlery manufactured under its name.
By 1960, Ekco Products and its subsidiaries were engaged in manufacturing and selling a diverse range of housewares and builders’ hardware items, commercial baking pans and industrial food-handling equipment. Some of Ekco’s most important brand names were Ekco, Ekco Eterna, Ekcoloy, Ekco-Autoyre, Flint, Geneva Forge, Waverly Edge, Berkeley, Kennatrack, Worley, McClintock and Pakkawood. 11 factories in the United States were run by the various arms and departments of the company. Some subsidiaries had their own manufacturing plants and factories. National Glaco had 15 manufacturing plants, and the English subsidiary, later named the Prestige Group Ltd., had five factories in England and two in Germany. The other foreign subsidiaries operated plants in Toronto, Mexico City and Sydney. Between 1950 and 1960, the net sales figure moved up from $31.5 million to $85.2 million. The net income, in the same period, increased from $2.9 million to $4.8 million.
This was also the period when Ekco entered new markets with new product lines. It formed the Ekco-Alcoa Containers, Inc. in 1955 with the Aluminum Co. of America. This enterprise supplied rigid aluminum-foil containers for frozen-food processing and TV Dinners. Ekco-Alcoa became Ekco Containers, Inc. in 1962, when Ekco purchased Alcoa’s interest in the company. Ekco formed an aluminum-foil container company in Denmark in 1963, in joint venture with Haustrups Fabriker Co. In 1964, Ekco’s English subsidiary, Prestige Group Ltd., formed a joint venture with McGraw-Edison for the manufacture and sale of small appliances in England, and for the export of these appliances to countries outside North America. Ekco Products Imports Co. was created in the same year to engage in the sale of cordless electric toothbrushes, shoe polishers and other products manufactured in Europe and the Far East to distributors in the United States.
Ekco containers accounted for 13 percent of overall company sales in 1964. The builders and industrial division accounted for 14 percent, and the bakery and chemicals division for 11 percent. 1964 Financial World study reported that while each major Ekco domestic and international division was doing well, the international operations were showing greater growth than the domestic divisions. According to a Financial World study conducted in 1964, all major Ekco divisions were doing very well, with the international operations outperforming the domestic divisions. The sales and earnings had reached record figures - $117 million and $7.6 million, respectively. The return on shareholders’ equity was an outstanding 17 percent. The company’s rapid growth was fuelled by an aggressive acquisition policy over a period of nearly thirty years. By the mid-1960s, however, there were very few companies left that could be acquired without the risk of antitrust suits. Ekco was purchased in 1965 by American Home Products Corp. for about $145 million in stock.
Ekco became the housewares division of American Home Products, and underwent many changes, particularly in its work culture. In 1970, the huge empire had 11 autonomous subsidiaries and a small staff. It was said to be highly decentralized, but almost all unplanned expenditures of $250 or more had to be explained to headquarters. They were studied and analyzed by a corporate finance committee, and had to be approved by the company’s chairman and president. An anecdote about the housewares division under American Home Products was that because of the frequent need of getting non-budgeted expenditures approved, “a series of presidents and other executives came and went before they could even find the executive washroom.” In 1967, the housewares division’s contribution to the total sales figure of $124.8 million was 12 percent.
The housewares operation was split into three divisions by 1972 – Ekco Products Inc., Ekco Housewares Co., and The Prestige Group Limited. Ekco Products manufactured and sold commercial baking pans and provided service, aluminum containers, food-handling systems, industrial coatings and closing machinery. The housewares division dealt in cookware, cutlery, kitchen tools, tableware and accessories. It operated under many brand names like Ekco, Flint, Granny, Criteria, Geneva Forge, and Berkeley. The Prestige Group was the largest manufacturer of non-electrical housewares outside the United States. The sales of these three divisions amounted to an estimated $186 million or 13 percent of American Home Products’ total sales, and 22 percent of its sales figure outside the United States.
In 1984, American Products Co. sold its housewares unit to focus on its prescription-drug business. Its controlling interest of 73 percent in the English subsidiary the Prestige Group, was sold for about $51 million to Gallaher Ltd., a British division of American Brands, Inc. Packaging Corp. of America, a unit of Tenneco Inc., bought Ekco Products Inc. A group of companies led by Gibbons, Green, Van Amerongen Ltd., a New York investment-banking firm, purchased Ekco Housewares Co. This investment-banking firm specialized in leveraged buyouts and kept a 15 percent interest in the company.
Ekco Housewares had an annual sales figure of close to $200 million by this time, and was going strong. It had control over 40 percent of the market in bakeware, and over 20 percent in kitchen utensils in the United States. These figures placed the company virtually at the top in this field. However, its position was not so secure in the in the cookware, cutlery and flatware segment. These products were sold door-to-door in the United States, and marketed to retailers in other countries. Ekco’s ordinary performance in this segment prompted it to hire a Canadian Dane, Finn Schjorring who vowed that he, with his direction would “reestablish the company to its former glory.” Schjorring had been a manager in the American Home Products Corp., and had joined Ekco Housewares as a consultant in 1983. In an interview given to HFD, Schjorring said, “I feel that American housewares [manufacturers] have ignored the proper presentation of merchandise to the consumers to entice them to want to buy. We simply have not been entrepreneurial nor creative enough in our approach.... Food-preparation products should be aesthetically pleasing, and we want to bring contemporary concepts in the way of design. Europe is where the trends are born, and we will bring some of that innovation over here."
In another interview given to HFD a year later, he was even more outspoken in his criticism of some of the policies of the company. He is quoted as having said, “It's hard to believe, but the products Ekco and other American manufacturers are turning out today aren't much different from what we were making a century ago. In kitchen tools and other products, the U.S. market is hopelessly old-fashioned, uninteresting, and unimaginative. As a result, all of our businesses here are underdeveloped."With a well-defined plan of action, Schjorring made rapid changes in the company. In under a year, he dissolved the old management team and inducted a new team with an equity interest in the company. He created new lines of merchandise, and went in for an assertive and strong advertising and marketing strategy. About half of the company’s sales could be attributed to the U.S. grocery-store trade. To further the company’s interest in this area and to dedicate more efforts and attention to other accounts, he downsized the sales force, and signed distribution agreements with 68 food brokers. Schjorring launched bakeware with a coating that was smoother and 70 percent “slipperier” than the old range which made it easier to release food and to clean. A nonstick broiler pan and a Nova line of kitchen tools in bright primary colors, styled in the European fashion, were also launched.
Before Schjorring’s efforts could come to fruition, however, Ekco Housewares was sold once again. Centronics Corp., a shell corporation previously known as Centronics Data Computer Corp. purchased Ekco in 1987 for about $124 million. Centronics Data Computer Corp. was a manufacturer of computer printers. It bought Ekco Housewares with the income of around $85 million from the sale of this business. Centronics, operating from Nashua, New Hampshire changed its name to Ekco Group Inc. in 1988. Later the same year, Ekco’s Canadian industrial container business was sold to Packaging Corp. of America for close to $12 million.
The new management had to deal with a concerted demand to sell the company almost right away. A group, consisting of Sonar Partners, L.P., among others, wanted the company sold and the income from the sale distributed to the shareholders. This group had a share of more than eight percent in the company, and the management had to strain itself to protect the company from a takeover bid. They bought out the group of challengers in March 1989 by paying them $5.4 million for their shares.
In 1988, Ekco Group was made up of Ekco Housewares and Ekco Canada. 21 percent of the annual sales of $130 million came from Ekco Canada. Although Ekco also sold kitchen tools and gadgets, nonstick bakeware supplies was what it was best known for, and the Baker’s Secret brand was the most famous of its brands. Bakeware manufacture and supplies accounted for more than half of Ekco’s business. The president and chief executive officer of the group, Robert Stein, laid emphasis and made efforts to improve the company’s on-time delivery rates.
Ekco Group purchased Woodstream Corp., a manufacturer and distributor of plastic storage cases such as fishing-tackle boxes, tool boxes, and gun cases in 1989 for about $25.7 million. Later the same year, Ekco purchased the Victor mouse and rat-trap line from McGill Metal Products Co.
With the purchase of Woodstream, the group’s revenue rose from $135 million in 1988 to $186 million in 1989, and its net income went up from $3.1 to $4.1 million. In 1990, the company went in for restructuring and ran up restructuring charges of $3.6 million, which reduced the net income to $1.8 million. The revenues also fell to $162 million. However, it succeeded in bringing down its debt from around $100 million to under $90 million. Revenues surged to $166.7 million in 1991 and the net income to an unprecedented $10.1 million.
Robert Stein reorganized Ekco’s work process and structure. Six plants were closed, and employees were reduced by 60 percent. The sales force was now organized by distribution instead of product divisions, with one group appointed to handle the trade in supermarkets, one in hardware and mass merchandisers like Wal-Mart and K-Mart, and one in export markets. The group conducted studies on consumer attitudes on a range of issues like quality and value. Stein said that the aim of these studies was to "be the total service-leader-supplier, so that price is not the only difference." Employees had to shoulder greater responsibility, and were held strictly accountable and answerable. Executives in the higher tiers were responsible for decisions solely and exclusively limited to matters of strategy.
The animal-care products division of Beacon Industries, Inc. was purchased by Ekco Group in December 1991. A month later, Frem Corp., a manufacturer of molded-plastic storage components, was acquired for $18.6 million in cash and stock. Kellogg Brush Manufacturing Co., maker of brooms, brushes, and mops, was purchased by Ekco in 1993. Over and above a payment of $33.9 million in cash and stock, Ekco also undertook to pay $13.1 million of Kellogg’s debts. It kept the management of Frem Corp. and Kellogg with itself.
Ekco Group's net revenues reached $206.6 million in 1992. Net income that year was $8.6 million. In 1993 net revenues, enhanced by the Kellogg acquisition, rose to $246.4 million, but after a $3.2-million accounting charge for postretirement and employee benefits, the company incurred a deficit of $988,000. The restructuring included a cut of about ten percent in the company's work force, most of it in the Ekco Housewares division. In 1994 net revenues rose to $267 million, and net income was a record $11.4 million. For 1995 the figures were $277.1 million and $8 million, respectively. The long-term debt was $132.7 million at end of September 1995. Ekco Group’s net revenues scaled $206.6 million in 1992, and the net income was $8.6 million. With the acquisition of Kellogg, net revenues increased to $246.4 million in 1993. Post-retirement and other employee benefits, however, resulted in an accounting charge of $3.2 million, which left the company with a deficit of $988,000. About 10 percent of the Ekco Housewares work force was cut down, as part of the restructuring. The net revenues in 1994 increased to $267 million, and the net income, a record $11.4 million. In 1995, net revenues rose to $277.1 million, and net income came down to $8 million. By the end of September 1995, the company’s long-term debt was $132.7 million.
By 1995, Ekco Group’s products included a wide range of metal bakeware for domestic use under the trademarks Baker’s Secret and Ekco. Over a thousand kitchen tools and gadgets were being sold under the trademarks Ekco and Ekco Pro. It was also selling stainless-steel and carbon-steel cutlery and stainless-steel flatware, mixing bowls and colanders. Ekco also manufactured and assembled some of these products. A line of cleaning products and nontoxic pest-control and small animal-care and-control products, injection-molded plastic housewares, office, and juvenile products, were also manufactured and sold by Ekco at this time. Ekco products were sold in 30 mass merchandise stores all over the United States. Wal-Mart and K-Mart, which constituted more than 90 percent of all U.S. supermarkets, were its biggest clients.
In 1995, 29 percent of Ekco’s sales came from the bakeware division. Second in line was the kitchenware division which accounted for 26 percent. Cleaning products and pest-control products stood at 19.5 percent and 12 percent respectively. Molded plastics accounted for 10 percent, and an international subsidiary formed in 1994, contributed the last 3.5 percent.
Ekco’s facilities included seven manufacturing and distribution plants in the United States and an office and distribution facility in Canada. It rented executive offices in Nashua, New Hampshire and administrative offices in Franklin Park, Illinois for the housewares division.
Ekco Housewares, Inc.; Frem Corporation; Kellogg Brush Manufacturing Co.; Woodstream Corp.; Cleaning Specialty Company; Wright-Bernet, Inc.; B. VIA International Housewares, Inc.; Ekco Consumer Products Ltd. are the major subsidiaries of the Ekco Group.