Swedish Tool Firm Buys Orange-based U. S. Distributor
Lindstrom AB, a 121-year-old hand-tool manufacturer in Sweden, has bought its U.S. distributor, Vertron International in Orange, for more than $5 million in cash and intends to begin producing some of its products here.
Vertron, which becomes Lindstrom America, expects to produce as up to $4 million worth of “high-tech” cutters, pliers and screwdrivers next year at its Orange plant, according to Dean Gittleson, Vertron’s previous owner.
Gittleson, who will be president of Lindstrom America, said local production will begin in the next few months.
Lindstrom, with headquarters in Eskilstuna, manufactures all its products in Sweden.
Gittleson said Lindstrom expects to significantly increase its share of the U.S. market for advanced hand tools used to assemble and repair computers. Domestic sales of those tools is running about $60 million annually, he said.
“It makes sense. We wanted more resources to expand, and they wanted to make products in America,” Gittleson said. He added that he and other managers from Vertron have been asked by Lindstrom to stay with the company for three years.
Lindstrom decided to begin U.S. production because the relatively low value of the dollar makes it less expensive to manufacture some tools here rather than in Sweden, according to Gittleson. He said concern that Washington might clamp down on imports also prompted the decision.
Gittleson said the company has not yet decided which products will be made in Orange. But by 1991, he said, up to 70% of the company’s production may be in this country.
The company expects to expand its product line over the next few years, Gittleson said, but it will continue to concentrate on its primary products: carbon-steel pliers, cutters and screwdrivers designed with handles that reduce user fatigue.
The tools are used by such companies as Apple Computer, Western Digital and Rockwell International to aid in assembling circuit boards, radar screens and electronics products. Most Lindstrom tools sell for $16 to $40, but the company makes some specialty items that cost up to $6,000.
Lindstrom America also plans to diversify into lower-priced tools by buying and reselling products made by other manufacturers in Italy and the United States.
The Swedish parent company was founded in 1856 by Franz Lindstrom, who began marketing pliers he had developed to shoe horses. The company says the pliers were the first to be widely used throughout Scandinavia.
The company specialized in making tools for technological uses as the electronics industry developed in this century. The firm is now part of the publicly held Bahco Investment Group in Stockholm, which reported sales of more than $700 million last year. Lindstrom had 1986 worldwide sales in excess of $20 million.
When production begins in Orange, five workers will be added to Vertron’s staff of 27, Gittleson said. Vertron was expecting the sale when it moved its headquarters last month from a 5,000-square-foot facility in Torrance to a 17,000-square-foot building in Orange.
Gittleson, 28, bought Vertron in 1985 from his father, Howard Gittleson, who founded the company in 1978 after noticing a relative scarcity of technological tools to supply a growing market.
Vertron’s sales were less than $1 million in 1978 but grew to more than $6 million last year, Dean Gittleson said.
