Blockbuster deals usher out 1995.

The office furniture industry saw two of its biggest members buy up or sell out as 1995 waned.

The final months of 1995 witnessed the announcement of two blockbuster deals. In October, Haworth, the country's second largest office furniture maker continued its growth-through-acquisition philosophy in announcing its purchase of Office Group America, and in December, The Knoll Group finally got off the on-the-market, off-the-market rollercoaster with the announcement that it had been sold.

Continued growth through buyouts

Haworth is not new to the acquisition biz. Over the years, Haworth has been one of the most aggressive office furniture companies in terms of acquiring other companies. These acquisitions date back to at least 1988 when Haworth acquired Comforto. Other acquisitions included the 1990 purchases of Mueller Furniture Corp., Kinetics and Lunstead, the 1993 purchase of Globe Furniture, the 1994 acquisition of the Tijuana, Mexico-based upholstered wood office furniture maker, GSP Manufacturing, by Globe, and now the purchase of Office Group America in 1995.

Haworth announced Oct. 23 it had purchased Office Group America of Leeds, Ala., for an undisclosed purchase price. Office Group, a Division of U.S. Industries, had sales of approximately $150 million last year and is made up of two office furniture companies, United Chair and Anderson Hickey. With the purchase, Haworth sales could reach more than $1.15 billion in 1995.

United Chair, with plants in Alabama and Mississippi, specialized in office seating and is marketed through dealers and wholesalers. It employs more than 500 people. Anderson Hickey is a producer of metal office furniture, with plants in Texas, Tennessee and Utah. It also employs approximately 500 people.

Haworth says its acquisition of Office Group America, along with its 1993 acquisition of Globe, gives the high-end office furniture maker a big presence in the mid-range segment of the office furniture industry. "The products of United Chair, Anderson Hickey and Globe complement those of Haworth," said Jerry Johanneson, Haworth president and chief operating officer. "We provide complete office furniture lines for home offices, small-to medium-sized businesses and national and international corporations."

Going into television

In a move to raise finances for its acquisition of network television giant CBS Inc. for a reported $5.4 billion, Westinghouse Electric Corp. sold off The Knoll Group to an investment firm for $565 million.

In January, Westinghouse, the giant conglomerate with its corporate fingers in many pies, also sold off its defense and electronic systems to finance the television acquisition.

Warburg, Pincus Ventures, an investing group, signed an agreement Dec. 21 to buy The Knoll Group from Westinghouse. The management of Knoll, including chairman Burton Staniar and vice chairman John Lynch, will remain with Knoll and are anticipated to become shareholders in the company. Lynch will also serve as president of the company.

The Knoll Group had been a wholly owned subsidiary of Westinghouse since 1990 when it was created by the merger of Reff Inc., Knoll International, Shaw-Walker and Westinghouse Furniture Systems.

Knoll, which has annual sales of $600 million and employs 3,600 people worldwide, had been on, then off and then back on the trading block over the last couple of years.

With its purchase of Knoll, which was expected to set record-breaking profits in 1995, Warburg, Pincus Ventures has added to the variety of its business holdings. Among its current holdings are companies ranging from Mellon Bank Corp. to Value Health Inc., a managed healthcare organization; also LCI International, a long-distance service provider; and Zilog Inc., a producer of specialty semiconductors.

According to a statement from Knoll, Warburg, Pincus' philosophy and approach to business includes direct equity participation, a long-term investment orientation and ongoing active involvement with company management.

Merger and acquisitions activity

In addition to Haworth and Knoll, other companies were involved in business activities.

In late 1994, for example, the contract seating and RTA furniture manufacturer Loewenstein merged with casual furniture manufacturer Winston Furniture Company Inc. This came on the heels of a number of purchases of RTA and futon companies by Loewenstein. Now, the company is scaling back with the announcement it is selling its Excel Office and Contract Seating Inc. subsidiary located in Hickory, N.C., a manufacturer of promotionally priced office furniture.

Other acquisitions included the December 1995 purchase of Garden Grove, Calif.-based Vogel Peterson by EAC Corp. of St. Louis, Mo. EAC Corp., which had been known as EckAdams Co. and still produces an EckAdams product line, specializes in ergonomic seating products. Vogel Peterson is a manufacturer and marketer of modular office furniture, tables, seating and wardrobe products. EAC has formed a new division, EAC Integrated Furniture Solutions, to manufacture and market the EckAdams and Vogel Peterson product lines.

Also, in March 1995, Geiger International acquired the design rights and patents for Herman Miller Inc.'s Sanford and Madeira wood case goods collections. Herman Miller has ceased manufacturing wood case goods products. The two companies have since entered into a strategic sales alliance which gives Herman Miller sales representatives and dealers exclusive access to the two wood case good lines. (See related story on page 71.)

According to Russell Coyner, executive vice president of the Business and Institutional Furniture Manufacturers Assn. International, "There have been a lot of mergers and acquisitions and there may be more to come."