Sherwin-Williams-Company-Acquisitions

The History of Sherin-Williams Acquisitions

The giant Sherwin-Williams and Valspar merged on June 1, 2017, Sherwin Williams and Valspar combined forces when they merged. As a result of the Sherwin-Williams and Valspar merger, Sherwin-Williams is now the largest retail paint company in the world.

History of Sherwin-Williams

In 1866, Henry Sherwin spent his life savings of $2,000 on buying a partnership in the Truman Dunham Company of Ohio. These are the roots of the Sherwin-Williams Company.

At that time, the company distributed pigment, painting supplies, oils, and glass. A paint store did even more than our paint stores do today.

Painters bought and mixed their paint daily as it was not shipped premixed like today’s paints. The dealers mixed the paints by hand and sold them from their stores. So, consumers had a limited number of colors to choose from.

Within four years, Sherwin’s original partnership dissolved. One would have thought this would be the end of the Sherwin name in the paint.

But the resilient Sherwin signed on new partners Edward P. Williams and A.T. Osborn. They named their company Sherwin-Williams & Company.

The partnership went on to buy out a handful of companies over the next century. This led to a company with more services and products.

In 1877, the Sherwin-Williams & Company transformed into The Sherwin-Williams Company.

Sherwin Williams Internal Expansion

In 1884, Sherwin Williams made their smartest move. They hired their first chemist. This chemist researched and developed new products for the paint industry. They were no longer selling paint. They were improving the paint.

Henry-Sherwin-Paint-Founder

In 1888, Sherwin-Williams opened a manufacturing plant in Chicago. With this move, they could best serve the Pullman Company and the farm-implement and carriage industries. Pullman’s cars required up to 20 coats of high-quality finishes.

The late 19th century saw the company grow by opening a marketing department and a sales agency. In 1905, the Cover the Earth trademark was developed, and Sherwin Williams forever became known for a bucket of paint that doused the earth.

Sherwin Williams External Expansion

In 1920, Sherwin-Williams made its biggest move as a company by going public on the stock exchange. The war effort in 1940 boosted the company’s opportunity to serve its country. SW responded to the country’s need for camouflage paint for their war vehicles.

In 1977, revenues reached a whopping $1 billion; in 1992, the 2,000th retail outlet opened.

In 1995, Sherwin Williams began to take over the painting business by purchasing 16 companies in 21 months, and in 2006, sales reached $7.8 billion.

In 2017, the company purchased Valspar. The Sherwin-Williams and Valspar merger cost Sherwin-Williams $11.3 billion. Valspar is a big deal. The merger of Sherwin-Williams and Valspar made Sherwin-Williams the worldwide leader in coatings.

After the Sherwin Williams Valspar merger, Sherwin Williams maintained its headquarters in Cleveland, Ohio, and transformed the Valspar headquarters in Minneapolis, Minnesota.

What is Valspar?

In 1806, sixty years before Henry Sherwin spent his life savings on buying into a partnership that eventually became the global powerhouse, Sherwin Williams, Samuel Tuck bought Paint and Color on Boston’s Broad Street.

Fourteen years later, two businessmen in Cambridge, unrelated to Tuck, began the first commercial production of varnishes in the United States. Then, in 1832, Tuck’s Paint and Color and the varnish business joined to become Stimson & Valentine. They were known for their varnish and dabbled in the paints, oils, glass, and beeswax business.

In 1860, Valentine brothers Lawson and Henry became sole partners and renamed the business Valentine & Company.

Valspar’s Internal Expansion

Right around the time Sherwin Williams came into existence, Valentine hired a chemist, Charles Homer, brother of New England artist Winslow Homer.

Holmer made varnishes so perfect they could be poured from the can to the side or back of a carriage. They flowed smoothly and evenly, and they dried perfectly. Because of Holmer’s expertise, the company began specializing in vehicle finishing varnishes.

In 1903, Valentine’s grandson, L. Valentine Pulsifer, joined the company. Pulsifer came fresh out of Harvard with a degree in chemistry in hand. Three years later, Pulsifer produced Valspar, the varnish that has become known as the standard for varnishes in the world.

The company created an exhibition at the Grand Rapids Furniture Show, where they tested the varnish with a boiling water test. It passed with flying colors.

Valspar’s External Expansion

The company began another phase in the 1950s, 60s, and 70s, buying out several other companies. They moved their headquarters twice, finally landing in Minneapolis after merging with Minnesota Paints in 1970.

The next two decades saw increased growth, with the company buying out more large-scale paint operations like the $100 million acquisition of the Mobil chemical coating business in 1984, which moved Valspar from the 10th to the 5th largest coatings company.

The twenty-first century meant international growth for the company, with facilities opening in Shanghai and  Vienna. Valspar became known for its coatings on Asian wood and European packaging. By 2002, 25% of sales occurred outside the United States.

Valspar had a value cap of $5.3 billion before the Sherwin-Williams and Valspar merger and has reported increased dividends since 1992.

Does the Sherwin Williams and Valspar Merger Matter?

On June 1, 2017, these two paint giants merged. The Sherwin-Williams and Valspar merger matters. But why?

Valspar-Sherwin-Williams-Acquisition

Initially, economic experts believed the merger would create a monopoly. But while Sherwin-Williams is the largest coating company in the world now, it still only takes up a small part of the entire coatings market. It does not control a large part of the overall market.

Financially, Sherwin Williams projected revenue growth and $320 million of annual run-rate synergies. This means the single combined company made more money than the two individual companies combined.

History Matters

Sherwin-Williams and Valspar each have a rich history of producing quality paint and varnish. Their journeys parallel each other with hard-working founders who then sought out chemists to make their businesses great.

Each one also was doing well on the stock exchange at the time of the merger. They each had a history of dividend increases.

Unless you’re an employee of Valspar directly or one of the many non-profits blessed by Valspar’s benevolence in the Minneapolis area, you don’t have much to worry about.

Since both companies have a great record of research and excellent products, you now have the combined effort of smart scientists who can make a great product even better.

In fact, after the merger and the change of headquarters from Minneapolis to Cleveland, the research group grew by 25 percent in the Minneapolis area.

Business Acquisitions Over the Past 20 Years

While SW has a great history and has made pivotal business moves conducive to long-term growth, the multitude of seemingly less significant or less overt partnerships and acquisitions has fortified its position as a paint giant.

These acquisition milestones range from 1980 to 2013.

  • Dutch Boy Year 1980
  • Pratt & Lambert Year 1996 ($400 million)
  • Minwax/ Thompson & Thompson Year 1996 ($830 Million)
  • Purdy Year 2004 ($295 Million)
  • White Lightning 
  • Duron Paints Year May 2004 ($235 Million)
  • MAB Paints ($146 Millon)
  • Comex Paint Year 2013 (2.34 Billion)

European Market Acquisitions

The earliest buzz comes from Sherwin-William’s recent slew of purchases of European-based companies. Valspar had a heavy influence on the European market. Since SW acquired them, SW has gained strategic positioning and insight within the continent, making impactful business moves and gaining further hierarchy globally. 

  • Tennant Year 2021
  • Sika Year April 2022 (Germany)
  • ICA Year 2022 (Italy)
  • DuraFlex Year 2022 (US)
  • Klump Coatings Year 2022 (Germany)
  • Oskar Nolte Year 2022 (Germany)
  • Phoenix International Year 2022 (Australia)

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