Special One-to-One interview with Brian Carson and Greg Mather
In September, AHF Products purchased the assets of Crossville, a leading manufacturer and distributor of porcelain and ceramic tile. In an industry where consolidation has been happening at a much brisker pace than in the past, the news was viewed favorably by flooring leaders as a transaction that should benefit both companies for many reasons.
For AHF Products, the acquisition (their fifth in five years) positions them as a leader in the tile industry, filling a void in their platform of brands. For Crossville, a business owned previously by the Curran Group, the move opens new avenues of revenue growth potential and supports their need to remain competitive in a changing industry. TileLetter spoke with Brian Carson, president and CEO of AHF Products, and Greg Mather, president of Crossville, in this month’s special One-to-One interview.
What led to this acquisition and what is this going to look like moving forward?
Carson: If you aren’t growing, you are shrinking, in my opinion. We had a void in our portfolio, and it was ceramic tile. We are not experts in ceramic tile, but Crossville is. We had some experience in tile, but this now positions us as an industry leader, complementing our position we enjoy in other flooring categories. We started as a wood company, adding commercial and residential sheet vinyl, commercial and residential LVT, VCT, and now ceramics. This makes us a leader in hard surfaces in all major categories.
What are some key strategic objectives of AHF Products that led to the Crossville acquisition?
Carson: We are very brand focused, and Crossville fits perfectly into our product portfolio. Some of our better-known brands include Bruce Hardwood, which goes back to the 1800’s, so literally America was built on our products. The Armstrong brand, coupled with Bruce Hardwood, is also widely known by consumers as well. Add to that Hartco, LM Flooring and Crossville, known by industry professionals, we have a grouping of wonderful brands that we can invest in to continue to grow and develop our business. There were many things we liked about Crossville, and one of them was their reputation as a known brand in the tile industry.
Describe for us what the process was like to begin discussions and how it led to the acquisition.
Carson: Greg (Mather) and I talked about this recently and it really was a perfect fit for many reasons. Most projects have multiple surfaces being sold and installed in them. It is becoming increasingly important to be able to provide comprehensive solutions to your customers. The more solutions we can provide for them, the more opportunities there will be for us. Crossville was looking for the same thing, making our initial discussions productive from both sides. We had the basis of something we could really build on. We had similar cultures and beliefs, yet different customer bases. The discussions grew from that rather quickly. We were looking for a domestic ceramic manufacturer who could position us in the tile category and we could not have found a better fit than Crossville.
The Curran Group is very respected in the tile industry. What was important to them as owners and to the leaders of Crossville as this opportunity was presented to you?
Mather: Crossville has established a leadership in the industry. This includes participation in industry associations like TCNA, NTCA, CTDA, etc. We have worked closely with contractors to set standards and we are respected for our contributions to the industry to grow the tile market. This is a good thing for the industry. It will give us the opportunity to be strong and competitive. In just eight years, domestic manufacturing in the U.S. has gone from five companies to nine, and I expect that number to grow. There are global companies investing in the U.S. domestic market. The Curran family looked at this as an opportunity to remain competitive and remain a leader in the industry by pairing up with a company that possessed strong brands in other hard surface categories, allowing for additional resources to invest in technology and equipment and to continue to grow the Crossville brand.
AHF has a proven track record of commitment to their distributor and contractor channels, and they understand the value of manufacturing and being efficient and investing in the business and I think this is a win-win for all of us.
What made now the time for the Curran family to sell the assets of Crossville to AHF?
Mather: Those who know the family and their business structure know the Currans are first class all the way. They built a lot of their businesses serving and developing niches in different industries. In 1986 when the Currans built the Crossville factory, porcelain tile was a niche product. This isn’t the case anymore. I think the Currans asked how does Crossville keep the brand strong for the next 10 or 20 years and how does that align with their niche development strategy? I think they correctly identified a need for partnership and AHF products was able to fill that need.
Carson: I would like to add I have been involved in a lot of acquisitions over the years and this experience was very different and extremely positive. We had joint meetings and of course the math always has to work when you do something like this, but the chemistry has to work as well. This was important to both sides and we spent a lot of time exploring this. The truth is that we are all thrilled about it, and see this as a great opportunity for everyone.
What are some new opportunities you hope to build moving forward?
Mather: Having more resources is one asset and having the ability to tap into experts in the AHF family in other categories and sharing best practices with each other will open doors for us to grow our supply chain and maximize our production at the factory level. Being better operationally as well as how we approach the market is going to help position us to grow moving forward.
Carson: An example of what Greg is talking about centers on logistics. We can optimize the way we move product at our plants and facilities and share resources to better serve our customer’s needs. We also are committed to investing our resources in manufacturing and building off of great ideas to develop products with modern technology. I wish the market was stronger and more stable moving into 2024, but I believe if you come up with a good plan, and you execute and adjust as you go, success will follow. We are going to naturally be more efficient with logistics due to the locations of our plants and facilities and this will provide for more efficiency and better customer service.
Crossville has played a leading role in supporting efforts in the industry led by TCNA, NTCA, CTDA, and CTEF, among others. How will the AHF acquisition impact this, or can we expect this support to continue?
Carson: From my standpoint, AHF is a leader in the categories we have invested in, and we take that role very seriously. With that leadership comes responsibility to the industry. Whether that is in supporting your employees, your distributors or dealers, or the trade and the people making a living off of the products you provide, that doesn’t change. We might be new to ceramic, but we take this approach in everything we do and you can expect that to continue moving forward.
Bart Bettiga is the Executive Director of the National Tile Contractors Association. Bettiga is a member of the Board of Governors of Coverings, one the largest tradeshows in North America. He has over 30 years of experience in the tile and stone industry and has served as the NTCA Executive Director since 2002. He is a well known speaker and author on ceramic tile and natural stone distribution and installation. He oversees the financial operations of the NTCA, TileLetter and the Ceramic Tile Education Foundation.