Clark Equipment Co.
List of Deals
- 1974 Clark Equipment Company: $50,000,000 9 5/8% sinking fund debentures due 1999; $50,000,000 9% notes due 1982
Clark Equipment Company was founded in 1903 as the George R. Rich Manufacturing Company. The company was located in Chicago and owned by executives of the Illinois Steel Company. Rich Manufacturing floundered due to its insufficient production volume. The company's owners eventually hired Eugene Clark as a consultant to examine the shortcomings of the company's product. Clark determined that the metallurgy of the product was poor, but added that the management and the basic operations of the company were also to blame for the Rich Manufacturing's lack of success. Clark was hired to manage the company and was made a partner as well.
After a year under Clark's management, the company was paying its bills on time and reported profits of more than 16 percent on sales of its Celfor Drill. In 1906 Clark changed the name of the company to Celfor Tool Company. That year, the company lost a large supply of drills in the San Francisco earthquake. A plant burned down in the following year. Despite these obstacles, the company was strong enough by 1909 to pay its first dividends to investors.
In 1909 the company built a second plant, called the Buchanan Electric Steel Company, which was to produce high-quality, high-grade castings and new technologies. The company diversified into other products that utilized the plant's ability to produce steel alloy castings. This diversification enabled Buchanan to become the second company in the nation to produce steel disc wheels for automobiles. The plant began producing steel truck wheels, which replaced the wooden-spoke truck wheels that were fragile and broke down regularly. Clark hired R. J. Burrows to design a truck axle that would be stronger and more durable than the unreliable chain drive. Burrows designed an internal gear drive axle that became smaller, or had a "final reduction," at the wheel. This design became the industry standard for truck axles.
Celfor Tool and Buchanan merged in 1916 and became known as Clark Equipment Company. Clark Equipment designed a gas-powered buggy with a box fixed on three wheels to assist in carting sand, supplies, and rough castings. The buggy, dubbed "Trucktractor," underwent several redesigns and was introduced during World War I. Later improvements resulted in a truck that could pick up material, move it to another area, and elevate it for stacking or placement. This improved product was introduced in 1927. That same year, the company began to produce transmissions for one of its axle customers. Clark went public in 1928, a year in which it achieved sales of approximately $12 million and net revenue of 10 percent.
Clark survived the Depression years, but in 1931 reported its first operating losses in over twenty years. The company developed the Auto-Tram, a fast, aluminum rail car, for the 1934 World's Fair. Although its prototype for the Auto-Tram did not sell, the company was selected to develop the undercarriage for trolley streetcars and subway systems. Clark supplied these industries with undercarriages for the following twenty years. By 1939 Clark had developed a new line of heavy-duty lift trucks and towing tractors that were used by the military in World War II.
The company began to diversify during the 1950s through product development and acquisitions. In 1953 Clark acquired Ross Carrier Company, a manufacturer of large lift trucks, straddle carriers, and cable cranes. Using this company's manufacturing capabilities, Clark developed a new line of rubber-tired front-end loaders and marketed the product under the "Michigan" brand names. In 1959 Clark entered the highway trailer business when it acquired Brown Truck Trailer.
During the 1960s the company acquired Tyler Refrigeration, Hancock Scraper, and Delfield Food Service Equipment Company. It was also during this decade that the company went international, through distribution and licensing agreements as well as through direct investments in overseas plants. By the end of the 1960s the company had divested itself of many of these acquisitions, as it focused on its core business and began to direct its efforts toward product innovations and product-line development. At that time, Clark's sales exceeded $1.4 billion, and the company operated major manufacturing plants in the United States, Canada, Europe, Australia, and South America.