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Ex-Goodyear division has new owner, the Carlyle Group, and new Fairlawn headquarters for showcasing of products
By Jim Mackinnon Beacon Journal business writer
Published on Thursday, Nov 08, 2007
Workers are still painting, wiring and otherwise touching up things around the just-moved-in employees of Veyance Technologies Inc. at the new corporate headquarters in Fairlawn.
Veyance Technologies, you say? What the heck is that?
Well, it's a $1.5 billion-a-year corporation. It has about 170 employees in the new headquarters off Cleveland-Massillon Road at Interstate 77.
Its 35 manufacturing sites, which employ thousands more people around the globe, make such things as rubber tank treads for the United States' Abrams tank, conveyor belts, rubber hoses and more.
The company name is a combination of the words ''convey'' and ''performance.''
Just 101 days ago, the company was called Goodyear Engineered Products, a division of the Akron tire maker whose roots go back more than 100 years, before Goodyear even made tires.
And today marks the 100th day of Veyance as its own corporation, spun off from Goodyear and sold for nearly $1.5 billion to Washington, D.C., private-equity firm the Carlyle Group.
This is also the first week that employees have been in the new
building. They moved out of their old offices at Goodyear's East Market Street campus during the weekend. Work has started on a second building next door that will house the company's technical people and bring campus employment to about 250 people.
''I would say the new headquarters are more a reflection of the future of our business, in the sense that we are bringing all of our associates together on the campus in Fairlawn,'' said Tim Toppen, Veyance Technology's chief executive and a 29-year Goodyear executive. ''Being in our previous location was more a reflection of the past, in the sense of the proud history of our business and the fact we've been in business more than 100 years.''
The new two-building campus, when completed as expected next year, will consolidate Veyance Technologies employees from four locations, Toppen said.
''Hopefully, that will provide more of an opportunity for more networking, a showcase where we can bring our customers in and showcase our products, a place we can call our own, kind of hang our hat on,'' he said.
That hat could have been hanging elsewhere.
Veyance Technologies' management team was wooed by other localities — Toppen won't say which ones — that wanted its corporate headquarters.
Veyance decided to stay in the Greater Akron area in large part because of the proximity to its largest customers and to be sensitive to company employees, Toppen said. Fairlawn, with help from the county and state, came up with the most attractive financial package for a headquarters, which included millions of dollars in aid, Toppen said. In addition, Fairlawn had a modern building that Veyance Technologies could quickly move into, he said.
The creation of Veyance dates to when Goodyear decided to sell Engineered Products to raise cash. The division was financially important to Goodyear, but not a strategic part of the company, Toppen said.
While now separate, the companies have kept close ties, including agreements for such things as payroll services and purchases of raw materials. Veyance also has a long-term contract to make Goodyear-branded products.
''To our customers in the marketplace . . . it's been kind of transparent,'' Toppen said. ''From a market standpoint, it's kind of been business as usual.''
Veyance Technologies' owner, the Carlyle Group, is one of the world's largest private-equity firms, with more than $75 billion in assets under management.
''They look at themselves kind of as a mutual fund,'' Toppen said. ''Instead of investing in stocks, they invest in companies. Their expectation is, our team will create significant value for them in terms of their investment. And their models are typically five years.''
That means in about five years, the Carlyle Group may seek to sell Veyance Technologies.
Veyance Technologies will have to pay down about $1 billion in debt that the Carlyle Group borrowed to buy the former Goodyear division, Toppen said.
In addition, the corporate goal is to double the company's annual revenue of about $1.5 billion to $3 billion in five years, he said.
Veyance Technologies is seeing double-digit growth for its products in Asia, Toppen said. Demand is strong for mining products, such as heavy-duty conveyor belts to carry coal, and oil industry products, such as specialized 24-inch-diameter hoses used to transfer oil from drilling platforms to tankers.
''The thing we've found is, (the Carlyle Group is) very collaborative, they're very supportive,'' Toppen said. ''They ask a lot of good, probing questions, but at the end of the day, it's our obligation to run the business.''
Jim Mackinnon can be reached at 330-996-3544 or jmackinnon@thebeaconjournal.com.
Workers are still painting, wiring and otherwise touching up things around the just-moved-in employees of Veyance Technologies Inc. at the new corporate headquarters in Fairlawn.
Get the full article here.
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