BEAVERTON, OR (BRAIN)—Yakima has tied its future to a Taiwan company that—among many other items—makes water filtration products and water coolers for Whirlpool. It seems an unlikely merger, but Kemflo International also makes parts for Yakima’s racks, and has for the last nine years.
The Taiwan manufacturer specializes in plastic injection molding. The privately held company reported revenues of $140 million in 2007, the last figure available. Kemflo has a 432,000-square-foot factory in Pingtung, a small city just east of Kaohsiung. Kaohsiung is Taiwan’s second largest city and the island’s largest port.
Kemflo employs 1,900 people worldwide with offices in Taiwan, Europe, the U.S. and a factory in Nanjing, China.
Jerry Heinlen, Yakima’s CEO, said the “merger,” which makes Yakima an independent subsidiary of Kemflo, will have no impact on Yakima’s current management, staff or sales organization.
“This is very good news and I’m very pleased with it,” Heinlen said in an interview Monday. The deal has been in the works for the last several months. “There will be no impact at retail. We will continue to operate as a stand-alone company,” he added.
Heinlen declined to discuss details of the new structure, pointing out that the companies involved are privately held. “I will tell you that it is, structurally, a merger,” he said. Yakima currently employs 55 people at its Beaverton office, another 200 at its Tijuana, Mexico, manufacturing and assembly plant, and another half-dozen or so scattered throughout the U.S.
Yakima has changed hands a number of times since its founding in Yakima, Washington, by Otto Bagervall, a German immigrant making handmade foot braces for canoes and kayaks. Bagervall sold Yakima Industries to Don Banducci and Steve Cole in 1979 for $80,000. Banducci and Cole promptly moved it to Arcata, California, but kept the name Yakima.
The pair later sold Yakima to Kransco, a San Francisco venture capital firm but stayed with the company. In August 2001, Kransco sold Yakima for $91 million to Watermark, an investment group formed to purchase and merge Perception and Dagger, two leading kayak brands. Watermark’s backer was Arcapita, a Bahrain investment bank. It was Arcapita that arranged the company’s merger with Kemflo.
Yakima went through months of turmoil in 2005 and 2006 when it shut down its operation in Arcata, putting more than 100 people out of work, to move to Beaverton, Oregon. Its offices are just a few minutes away from Nike’s campus complex. Heinlen took over in August 2006 in the midst of what had been a wrenching transition.
Heinlen, a former Merchant Marine officer, had been president of one of the biggest manufacturers of tool and storage cabinets in the world before moving from Waterloo, Iowa, to take over Yakima. Heinlen said the merger aligns Yakima with Kemflo, giving it a strategic partner and “tremendous” resources.
“I’m very happy where I’m at right now. It’s been a wonderful ride since I joined the company—that’s going on three-and-a-half years now. The company today is in excellent condition and we’re truly prepared for major growth. I am very pleased to be staying with it,” he said.
—Marc Sani
