The 2020 Mid-Year Economic Update_long

Kaman Targets Oil & Gas, Automotive with B.W. Rogers Acquisition

Kaman's presence in energy and automotive currently "negligible."

Kaman Distribution Group's planned acquisition of B.W. Rogers, Akron, OH, will provide a platform for expanding into the energy (specifically oil & gas) and automotive markets, two key markets where the distributor currently has a "negligible" presence, according to Steve Smidler, president of Kaman's distribution segment, in an interview with MDM.

As a percent of revenue, the two markets will still be relatively small for Kaman – "well in the single digits," according to Smidler – but strategically, they offer solid opportunity for long-term growth, growth that Kaman doesn't want to be on the sidelines for.

"Automotive can be cyclical, but a lot of people have benefitted from the uptick in investment coming out of the recession," he says. "And we just didn't have a presence in that space."

With the boom in shale oil and gas exploration over the past few years, opportunities for distributors in those markets abound. Getting a foot in the door with B.W. Rogers' presence in the Marcellus Shale Play in Pennsylvania provides opportunity not only for the fluid power part of Kaman's business, but also for its other segments.

"A lot of those rigs are more mobile equipment," Smidler says. "Across our three product platforms of automation, bearing and power transmission and fluid power, it's a great fit."

B.W. Rogers will become the platform company for Kaman's other fluid power acquisitions upon close of the deal, but the benefits from B.W. Rogers extend beyond the fluid power space, Smidler says. "A high percentage of the business is also automation and electrical in addition to fluid power," he says. "… How many distributors are out there that are focused on these three technologies? It's a great alignment, so that made it really attractive to us."

Learn more about the planned acquisition.

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