Printer Friendly

Lantor: not for sale and sailing along.

In the past year, the Lantor Group, the 15th largest manufacturer of nonwovens, has solidified its position as a force in the industry. The firm, which encountered some very formidable obstacles in the last few years with start-up problems on a new U.S. needlepunching line, a pending sale that never materialized and a tough economy for its industrial markets, has successfully moved forward to become a stronger enterprise the face of adversity. Lantor, which was officially taken off the market in mid-1992, has now defined a plan of action for its continued growth in nonwovens with the support of parent company Coats Viyella. The Lantor Group has come on strong in 1993, maintaining $120 million in sales.

"As soon as Coats Viyella announced that Lantor was not for sale," said chief executive officer Roel Lubbinge, "we had to make a variety of decisions on how to proceed." Last fall management presented ideas on this topic to its Coats Viyella parent and the group has since developed a strategic plan. "We decided to first concentrate on Europe because the main company is there," commented Mr. Lubbinge. "Lantor bv--which accounts for close to 50% of the Lantor Group's sales--has always been successful, but there had been a low level of investment in the Dutch company in prior years under [former parent] Tootal. Lantor bv had become less competitive and both Tootal and Coats became less committed to very capital intensive businesses," explained Mr. Lubbinge.

"We explained to our parent that we needed a certain amount of capital to grow our businesses," continued Mr. Lubbinge. Coats consequently hired several outside consultants last August to assist management in the development of a profit improvement plan; this resulted in a three year plan to improve competitiveness. "It was important to Lantor's management to see our new parent company's commitment to the Group; it was also important to our customers to see Coats doing this type of major new investment," he said.

On the subject of Lantor U.K., senior management made the decision to sell the subsidiary's hydroentangling line earlier this year. "We had invested in this production line in each of the last four years and were generally pleased by its technical performance," said Mr. Lubbinge. "However, based upon our strategic review, we realized that to be a significant market force in hydroentangling, Lantor needed to make still further investments in capacity, product development and marketing." Due to this, management decided to sell the hydroentangling line and restructure Lantor U.K. to focus on other priorities, including the complete upgrade in capacity at Lantor bv, explained Mr. Lubbinge. Today Lantor U.K. continues to manufacture dry laid nonwovens for the medical, industrial and nuclear/biological/chemical warfare protective apparel markets.

The group's new strategic plan has two focused priorities: the international interlinings market and the modernization and growth of Lantor bv. "The Lantor Group has an unusually strong strategic position in the international interlinings market due to our association with Coats Viyella, which is the largest sewing thread supplier in the world," said Mr. Lubbinge. "Coats Viyella is a global organization that operates in the same markets as Lantor and we even share many common customers. This fact provides Lantor and Coats the opportunity to mutually develop and globalize the interlinings business."

Another advantage, said Mr. Lubbinge, is that the company has the right sources in Europe and the Far East. "Our |Firet' interlinings have done well in Europe, where we really understand and know the market," he said. "Likewise, the Far Eastern markets continue to grow." Lantor has a 100% owned company in Australia and another in Hong Kong, as well as a 49.5% share in Lantor Korea, which was started approximately eight years ago.

"Having the advantage of a local Coats Viyella office and factory is a major benefit when seeking and establishing new markets," said John Brooks, managing director, North American operations at Lantor. "An existing market presence, as held by Coats Viyella, can expedite business growth as well as serve as a buildable strategic platform for market development." The Hong Kong operations of Lantor Far East are both a sales office and a local coating and finishing factory, while Lantor Australia focuses mainly on the Australian and Southeast Asian markets for interlinings and industrial products.

Also included in the new three year plan is the globalization of the various country businesses at Lantor. "The Lantor Group has not been run as a global business," said Mr. Lubbinge. "We are starting now with interlinings and in a three year timeframe we will be a global company in our key product market segments."

North American Operations Continue Strong

Mr. Brooks is equally optimistic about the future of Lantor's North American businesses, which are headquartered in Bellingham, MA. "The association with Coats Viyella has been beneficial for systems and financial development," said Mr. Brooks. "In addition, Coats Viyella's global presence has been positive for Lantor's exports and global sourcing. Coats is a well-run, strategically managed company, with broader resources than previously available from Tootal," he said. Lantor Inc. has grown in excess of 40% through the last three years; the division had 1992 sales in excess of $25 million. Total sales of Lantor products in North America now exceed $35 million, including imports shipped from Lantor U.K. and Lantor bv.

In 1991, Lantor Inc. invested in a large new six meter needlepunched line; it is now concentrating on obtaining the maximum capacity at the lowest cost from its prior capital investment, explained Mr. Brooks. "Our priorites are to continue investments in technical, high value products and in equipment and systems that drive down labor and material costs in our North American facilities," said Mr. Brooks. "Lantor Inc. may be one of the few profitable needlepunchers in the filtration field that also has a strong balance sheet and a consistent record of capital investments to support future developments and growth."

In addition to present capital investments, Lantor Inc. is very focused on the evolution of a new product mix, which favors high value added technical products. "We are committed to the support of value added products that are technically complex and require investments made possible by our strong balance sheet," said Mr. Brooks. In particular, Lantor Inc. has been emphasizing its finishing activities and has recently introduced two new finishes that include a new permeable coated Teflon membrane structure called "Defender Cell" and an acid-resistant, water and oil repellent treatment identified as "IM-3010." Eventually, Lantor plans to reduce its dependency on commodity products--by shifting low margin production to offshore Lantor facilities located in favorable labor/cost markets--and reassign its higher technology production equipment to value added, higher margin technical products.

The final piece of the new Lantor Inc. American strategy is to aggressively grow its international business and exports of filtration fabrics. "As a part of both the Lantor Group and Coats Viyella, we already have a commitment to global marketing," said Mr. Brooks. Currently Lantor's North American operations sell and distribute products in more than 20 countries. Lantor Inc. clearly benefits from its association with other Lantor sister companies. "Over a period of time, we will globalize our Lantor Group operations to make delivery, price and customer satisfaction more effective," said Mr. Brooks. "The reality of our current sales effort is that the Lantor Group is already present in many markets and countries. We rarely have to explain to international customers who Lantor is; we have the ability to start our business very quickly," continued Mr. Brooks. "Accordingly, Lantor Inc. is planning to balance its domestic sales portfolio with significant offshore expansion."

In the last 12 months, Lantor has been testing the value of a joint expansion of its coating and finishing capacity in the southern part of the U.S. The initial success has interesting implications for future outsourcing; management has indicated that Lantor Inc. will continue to seek out joint venture opportunities in both Southeast Asia and Africa. "In that Lantor Inc. and filtration are not direct core parts of Coats Viyella, we must be creative in stretching our available capital funding and aggressive in locating partners that can add new technical process technologies and capabilities that will permit us continued growth," said Mr. Brooks.
COPYRIGHT 1993 Rodman Publications, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:International Top 30
Publication:Nonwovens Industry
Date:Sep 1, 1993
Words:1377
Previous Article:Akzo hangs tough in durables market.
Next Article:Potential sale not affecting activity at Phillips.
Topics:


Related Articles
The top companies in the worldwide nonwovens industry: the fifth annual look at the largest nonwovens producers in the world ranks and profiles the...
Lantor Group.
The top companies in the worldwide nonwovens industry.
CEO Lubbinge leaves Lantor International.
Lantor Group sold to Coats Viyella Management Team.
Lantor Group.
Successful Nordic nonwovens symposium held.
Lantor.
Lantor.
Management Acquires Lantor Group.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters