Latin America Reports

Devcon-Permatex Merge

By Charles W. Thurston | February 9, 2006

The Devcon-Permatex merger will increase sales and distribution activity in Latin America.

The January merger of the Devcon and Permatex industrial business units of Illinois Tool Works into ITW Devcon will both strengthen the North American sales and distribution network of the companies' industrial coatings and materials, and broaden the palette of products offered to industrial customers. The merger also should have a unifying effect on Latin American direct sales and distribution in Mexico, Venezuela and Brazil, where the companies have manufacturing and distribution operations.

"The biggest thing that will come out of the merger is that we will have a much stronger one-source package for customers," said Ian Goodland, Devcon's Canada business manager.

"The real synergy will come in shared distribution," added Jase Doane, the industrial marketing manager for ITW Devcon.

Devcon is an industrial coatings and materials manufacturer based in Danvers, MA, and Permatex is an industrial cement, coatings and lubricants maker based in Hartford, CN; the companies' product lines are largely complementary. Devcon products, primarily epoxy- and urethane-based, are widely used for equipment exposed to abrasive or corrosive materials, like pumps or slurry chutes. Both the Devcon and Permatex brands will continue to be marketed, with both now used under the ITW Devcon umbrella, John Norris, a company spokesman said. Devcon parent Illinois Tool Works (ITW) purchased Permatex in January 2005 and now has merged the industrial business of Permatex with its new ITW sister company Devcon.

"Devcon products, which include coatings for floors, rebuilding metals and rubbers, as well as some adhesive products, dovetail with the Permatex lines, which include thread lockers, instant adhesives, form-in-place gaskets and hand cleaners," said Norris. "If a customer has to repair a pump, he will need Devcon fillings and coatings, but he also will need to put the bolts back in, which would involve Permatex thread lockers. Apart from the obvious synergies in sales and distribution, there also will be savings in technical services, and in research and development."

Devcon industrial products used in maintenance and repair include epoxy, urethane, and methacrylate compounds for repairing metal, rubber, concrete and other materials. The company also produces coatings and linings for consumer home repairs. Devcon ventures in Latin America include: ITW Poly Mex, in Naucalpan, in Mexico state; Devcon de Venezuela, in Caracas; and Sideros, in Sao Paulo, Brazil. ITW Poly Mex opened its production facility in El Marques, in Queretaro state in 2001. Devcon business units are also located in several countries in Asia and Europe.

U.S. production facilities for Permatex include Solon, OH and Kansas City. Permatex Canada is based in Mississauga, Ontario. Permatex Mexico is based in Naucalpan, in Mexico state.

ITW, which is a Glenview, Illinois-based publicly-traded industrial conglomerate of over 600 companies with combined sales of about $12 billion, has a host of other business units which provide coatings and related products for the automotive, construction and marine segments. The ITW Devcon Futura coatings unit, for example, provides coatings for larger industrial applications, like thickener or clarifier tanks, and scrubber systems; these other divisions are not part of the Devcon-Permatex merger, Mr. Norris noted.

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