As the nation comes out of the recession, it is easy to see how many businesses have been negatively affected by the economic downturn. However, some businesses are emerging stronger than ever, with mergers and acquisitions that promise job and economic growth. One flooring company based in Georgia has made huge gains recently, particularly after spending $1.82 billion on acquisitions in the past several months.
Despite the housing market crisis of the past several years, Mohawk Industries, a flooring company, has been making a profit, diversifying its offerings through acquisitions and seeing the value of its stock rise. In the past 12 months, the company has seen a profit of $227 million, and is expected to grow even more this year. While Mohawk was affected by the recession, losing 2,000 jobs, it has found a strategy for growth that seems to be working.
Mohawk once specialized in carpet, but has acquired many companies, some abroad, that offer other types of flooring. In October, the company acquired a laminate wood flooring manufacturer that was one of its main competitors. In December, Mohawk bid on a ceramic tile company, and it purchased a chip and melamine board manufacturer in January. These latest transactions are part of a history of mergers and acquisitions that have allowed the company to grow over the years.
There is now some concern about whether or not Mohawk will keep its headquarters in Georgia, now that it is expanding more globally. However, some believe that despite its mergers and acquisitions elsewhere, the company’s growth can only mean good things for our state. Mohawk’s success may set an example for other business owners who are looking to grow. Acquisitions that are made carefully and correctly may help companies in our state get through tough economic times and emerge with a bright future.
Source: The Atlanta Journal-Constitution, “Mohawk comes out of downturn buying,” Michael E. Kanell, Feb. 17, 2013