Cooper Industries Cooper Industries was formed during the early 1920s

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Cooper IndustriesCooper Industries was formed during the early 1920s and they are manufacturers of heavy machinery and equipment. The company also became principal producer of engines and massive compressors. Unfortunately, the issue of concern during that time was the company?s heavy release on sales to the oil etc and the fluctuation of earnings Cooper Acquisition strategy had to include the following: 1. The industry had to be one where by Cooper could play a major role.

2. the industry should be fairly stable, with a broad market for the products 3. acquire only leading companies in their respective market Cooper made their first acquisition on 1967 they acquired Luftin Rule Company followed by I areas of business. Second, the industry should be fairly stable, with a broad market for the products and ""ii/j;(;(iiiC1line of "small-ticket" items. This product definition was intended to eliminate any company that had undu~ profit dependence upon a single customer or several large sales per year.

Finally, it was decided ~ The new strategy was initially implemented with the acquisition in 1967 of the LY- L1Jfkjn~p~the world's largest manufacturer of measuring rules and tapes.

Cooper acquired a quality product line, an established distribution system of 35,000 retail hardware stores throughout the United States, and plants in the United States, r ~ Canada, and Mexico. It also gained the services of William Rector, president of Luf- W kin, and Hal Stevens, vice president of sales. Both were extremely knowledgeable in tithe hand tool business and had worked together effectively for years. Their goal was to build through acquisition a hand tool company with a full product line that would use a common sales and distribution system and joint advertising. To do this, they needed Cooper's financial strength.

LQfkin provideH solid base to whi wo other companies wadded. In 1969 the Crescent NiagaWCorporation was acquired. The company had been hlg Iy profit- able in the early 1960s but had suffered in recent years under the mismanagement of esome investor-entrepreneurs who had gained control in 1963. A series of acquisitions {'i of weak companies with poor product lines eroded the company's overall profitability ~until, in 1967, a small loss was reported. Discouraged, the investors wanted to get out, / and Cooper--eager to add Crescent's well-known and high-quality wrenches, pliers, If and screwdrivers to its line-was interested. It was clear that some of Crescent's lin ~es would have to be dropped and inefficient plants would have to be closed, but the wrenches, pliers, and screwdrivers were an important part of Cooper's product policy.

I;] In 1970, Cooper further expanded into hand tools with the acquisition of t e lJv~ectric Co~ation. Weller was ~ng supplier of soldering tools to the in~ electrOllic, and consumer markets. It provided Cooper with a new, high-quality product line and production capacity in England, West Germany, and Mexico. (Information on the three acquisitions is provided in Exhibit 3.) Cooper was less successful in its approach to a fourth company in the hand tool business, the Nicholson File Company. Nicholson was on the original "shopping list" of acceptable acquisition candidates that Mr. Cizik and Mr. Rector had developed, but several attempts to interest Nicholson in exploring merger possibilities had failed. The Nicholson family had controlled and managed the company since its founding in 1864, and Paul Nicholson, chairman of the board, had no interest in joining forces with anyone.