“When your stars line up, you have to take advantage of it,” said Bert Wolf, who until mid-November was the owner of Acetylene Oxygen Company (AOC) headquartered in Harlingen.
A year ago, Praxair Inc., the largest industrial gases company in the Americas, first approached Wolf about selling his third-generation business to them. Wolf rebuffed the multi-billion dollar global corporation.
“But they were assertive, so I sat down and talked to them,” he said. The scenario which played out resulted in Wolf and AOC being featured in the Wall Street Journal article “Looming Tax Hike Motivates Owners to Sell.”
Praxair had several solid reasons for courting AOC’s owner. Praxair ranked AOC among of the nation’s top 10 compressed gas companies. After purchasing a Houston gas company, Praxair wanted a larger presence in Texas. It focused on AOC which had 18 locations from Houston and San Antonio to the Valley and Laredo with points in between, creating a very large footprint. Other pot-sweeteners were AOC’s existing customers in the booming shale oil fields and the fact that AOC was one of two acetylene manufacturers in Texas, which would free Praxair from buying the product from competitors.
In 1978, Bert Wolf joined the family business that his grandfather had started in 1936. Wolf continued growing the company, which specializes in industrial and medical gases, with new locations and a fleet of trucks delivering oxygen, nitrogen, argon, helium and chlorine.
“We made our career on small niche markets which happened to be the right location,” he said. “What made us very appealing to Praxair is that AOC is geared to pressured gas. That’s the attractive, sexy part of the business,” he said, in contrast to many industrial gas suppliers which emphasize welding supplies and equipment.
“They bought us because we were in good shape. I worked really hard to get it there. It was gift- wrapped package for them.” said Wolf, noting it is better to be chased than do the chasing. In his eyes, AOC was a mom-and-pop operation with revenues under $100 million being pursued by an international giant.
Prospective buyers had approached Wolf in the past, but he classified them as “serial acquirers,” organizations that would purchase competitors and often strip them of assets and shut them down. Concerned about AOC’s 300 employees, Wolf dismissed those offers.
In contrast, Praxair’s reputation appealed to him. “They were a good fit. They had no branches where we did. I felt this was the best fit for my employees. We’d see the least amount of casualties.”
To read more of this story by Eileen Mattei, pick up a copy of the February edition of Valley Business Report, on news stands now, or visit the “Current & Past Issues” tab on this Web site.