The Elevator Industry

Mergers and Acquisitions

The growth of elevator companies during the past 125 years has largely been through mergers and acquisitions. With the coming of national railroad services linking major cities it was not necessary for foundries and machines shops to make elevators for a single trade area, When heavy components could be shipped by rail between cities the better-financed regional manufacturers set about acquiring others not so fortunate. The enlarged survivors established sales and service offices where equipment had been previously produced. During a period when large manufacturers spent little on experimentation, compared with modern times, innovation came from rugged individualists, whether such persons were lone inventors or leaders of small companies with flexibility. Although such innovators were competent to create they often were not financially equipped to promote the new product, nor place it in production. Well-financed large manufactures acquired such products, entrepreneurs and/or companies. Having a new and wider range of products to market the growth manufacturers were on the lookout for independent elevator contractors who had built up substantial businesses in local areas. Often such independent contractors had been distributors for the manufacturer and were purchased at mutual convenience. Large manufacturers were also apt to purchase special components from suppliers and, when an opportunity arose of mutual benefit, the former acquired the suppliers as an arm of the purchaser. When large companies of similar power and affluence saw intimate cooperation to have mutual advantage a "merger" was apt to take place rather than an acquisition. With the coming of the Global Economy the process merely ratcheted up a notch, the largest companies striving to have world coverage by merging with, or acquiring, overseas manufacturing and/or maintainence facilities. (As a leading manufacturer acquired the writer's elevator contracting firm in 1963 the historic absorptions have always held a personal fascination. They have also held an interest for a former co-worker of some 45 years ago — E. W McDonald. "Bud", now retired in Mobile after a half century in the field, became interested in the Elevator Museum early in 2000; felt "Mergers and Acquisitions" deserved a place within the on-line history, and pulled much of it together. An appropriate place for this bit of memorabilia is in the "Human Interest" Wing. Like all other portions of the museum it cries out for completion. WCS)