ASW Global, a self-described supply chain solutions company, has been growing through acquisitions. It has expanded its existing marketing fulfillment division and added to its energy services division.
The strategy stems from the company positioning itself as a “platform company.” Its guiding principle can be summed up in a statement Andre Thornton, president and CEO, made in a press release announcing the change to its energy business: “This is what we do. We see a need and we develop the talent, resources and processes to meet the need.”
Within a month, ASW Global announced that it was acquiring Main Event Merchandise, an Indianapolis-based merchandising and marketing firm, and that it was reorganizing to form two entities dedicated to providing supply chain solutions and specialty services to the energy market. That’s a busy month for the 200-employee company based in Akron. But Thornton says the moves are all part of the plan.
Building up the marketing vertical
“When we look at our total strategic plan and we look at the verticals that we’re involved in, you’re looking to grow those verticals either organically through acquisitions or through strategic relationships or partnerships. And one of those ways for us to grow our verticals is acquisitions,” Thornton says, describing the reason the company pursued Main Event.
Prior to the acquisition, ASW was operating its own marketing fulfillment division, Global Promotions & Incentives. The addition expands the company’s employment base as it brings on employees from Main Event. It also expands its physical presence by adding offices, characterized by Thornton as small fulfillment or sales offices, in Colorado, Indiana and Tennessee.
ASW’s client base in this market has been mostly regional with some national business. With the merging of its existing marketing fulfillment division and Main Event, ASW gains a larger regional footprint, but also the ability to handle global business activity, Thornton says.
Growing its energy business
Showcasing its market diversity, the company also announced that ASW Energy Service, one of ASW’s business units, would grow to include ASW Pipeline. The new business unit operates as a subsidiary based in Geneva, Ohio, that comes into existence as ASW ties in its acquisition of Geneva Pipeline. The business will focus on constructing and maintaining natural gas distribution pipelines.
“The acquisition of the former Geneva Pipeline allowed us, from an asset standpoint, to increase our service offering to our clients in the energy and utility sector. So, again, for us, it was a matter of once acquiring these assets from Geneva Pipeline, it fit very nicely into additional services that we could offer our clients in the energy and utility arena,” Thornton says.
Strategy and diligence
Operating as a platform company allows ASW to be the foundation on which other companies are added. It has shaped its management structure in a way that allows it to find companies for which its management expertise can add value, giving it flexibility.
Its approach, however, has to be made through the prism of the company’s strategic approach to the market, and that helps determine what acquisitions the company pursues and how the company fills the gaps, in the broadest sense.
“Those kind of adjustments that go along with your overall strategy are always being looked at and assessed, but hopefully to help you get to where you’re trying to go,” Thornton says. “And again, that vision of being a platform company and creating the kind of management expertise around those companies has always been a goal, and we’re always adjusting to make sure that we reach that goal.”
Before engaging in acquisitions, Thornton says it’s of primary importance to scrutinize an acquisition to ensure it fits within the larger strategic vision management has set for the company.
“I think you always have to try to make sure that you never shortchange the process. No matter how attractive a situation or unattractive a situation may look, you want to let the process dictate what you’ve established, from a criteria standpoint, whether or not it fits your needs and your growth opportunities,” Thornton says.
That due diligence process should also extend to the people who are being acquired along with a company to make sure they fit the culture before the acquisition takes place. Then, once they’re added to the company, it’s important to indoctrinate them quickly.
“I think it’s a process of communicating to them, whatever the new employee base may be, what your culture is, what you’re expecting, and to make sure that the culture is one that allows your employees to know that you care about their success,” Thornton says.
“Your role as a company is trying to work with them to help create a successful entity. It’s creating that culture by communicating, for example, the realistic day-to-day activities that go on within that company. That’s an ongoing process of establishing what’s important to you and then living and working to those values. And that starts from the top down.”
