AstenJohnson Inc.

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AstenJohnson Inc.

4399 Corporate Road
Charleston, South Carolina 29405
U.S.A.
Telephone: (843) 747-7800
Fax: (843) 747-3856
Web site: http://www.astenjohnson.com

Private Company
Incorporated: 1999
Employees: 1,500
Sales: $115.8 million (2006 est.)
NAIC: 313210 Broadwoven Fabric Mills

AstenJohnson Inc. is a private company based in Charleston, South Carolina, manufacturing specialty textiles for the printing and papermaking industries. The company is one of the world's leading producers of paper machine clothing: engineered fabrics used in papermaking. AstenJohnson also manufactures a wide variety of specialty fabrics used for such industrial purposes as pulping, the production of building products, various chemical processes, de-watering tasks in mining, and the filtering of municipal and industrial sludge. The company also makes food-grade fabrics used to store and transport foods.

In addition, the company's Springfield, Massachusetts-based Johnson Foils subsidiary makes drainage equipment, cleaning systems, and ceramic products used in paper machines to remove water and form sheets while doing the least possible damage to paper machine clothing. AstenJohnson's products are sold throughout the Americas, Europe, and Asia. Operations include forming fabric plants in Appleton, Wisconsin, and Valleyfield, Quebec, Canada; press fabric plants in Clinton, South Carolina, and Jonesboro, Georgia; and dryer fabric plants in Walterboro, South Carolina; Kanata, Ontario, Canada; Eupen, Belgium; and Jiangsu Province, China. The company also produces filaments in a Williston, Vermont, facility and specialty fabrics in plants located in Montreal (Canada) and the Czech Republic.

Paper machine clothing is fabric that is installed on machines to carry the paper stock through the paper-making process, from pulp to flat, dry sheets. Three types of paper machine clothing are used throughout the process: forming fabric, press fabric, and dryer fabric. The first is used to filter water out of the pulp slurry early in the process. Forming fabric is made in various meshes that are used to create different grades of paper: the coarser the mesh the heavier the paper. A second type of paper machine clothing is called press fabric or "felts," between which layers of paper are flattened. Traditionally these were made from wool but since the 1950s synthetic materials have been used. Finally, near the end of the papermaking process, a dryer fabric is used to keep the sheet in contact with the drying cylinders. Each type of AstenJohnson paper machine clothing is manufactured in a plant dedicated to producing that particular type of fabric. While AstenJohnson is a young company, formed in 1999 when Asten Inc. of Charleston merged with Canada's JWI Ltd., its roots reach back centuries.

18TH-CENTURY ROOTS IN WIRE WEAVING

The older of the two companies was JWI, which traces its heritage to 1790 when John Stanair started a wire weaving company in Manchester, England. Within a few years he organized the business as the Manchester Wire Works, which produced mesh and wire in different gauges. Stanair produced lightweight, plated steel wire cloth for area flour mills. He also developed the first forming wires used in the earliest paper machines. This business was sold to C. H. Johnson in 1852 and later renamed C. H. Johnson & Sons Limited. The founder's grandson, Charles Johnson, was then dispatched in 1901 to Montreal to open the company's first North American plant, Johnson Wire Works. The firm, later known as JWI Ltd., would not open its first plant in the United States until 1959, when the initial facility in Jonesboro, Georgia, opened. By this time the paper machine clothing industry was undergoing significant changes, as the old wire cloth was replaced by synthetic products. As JWI's business grew, more plants opened in Kanata, Ontario, where the Drytex unit was located; Springfield, Massachusetts, home of Johnson Foils; Warrendale, Pennsylvania; and Williston, Vermont. JWI also expanded internationally, forging a partnership with a German paper machine clothing manufacturer, Thomas Josef Heimbach GmbH, in the early 1980s.

By the 1990s the various operations were housed under a holding company, JWI Group, which included Johnson Wires, Drytex, West Coast Wires, C.H. Johnson, and Johnson Foils Inc. Primarily supplying paper plants in Maine and Wisconsin, the company generated sales of about $120 million. A major factor in the company's success was its commitment to research and development. It patented a revolutionary dryer fabric, sold under the brand named ENERTEX, which became an industry standard. The company also added a large number of services its could offer to its paper mill customers, including advanced water removal testing, roll abrasion testing, machine drive load analysis, vibration analysis, and the testing of water content of felts, clothing tension, pocket humidity, and temperature. JWI offered a Full Machine Audit, providing customers with an analysis of their papermaking machinery and options to improve performance.

19TH-CENTURY HERITAGE IN FELTING

The Asten lineage reaches back to Oscar von Asten, who in 1882 cofounded a Belgian-Austrian felt company in Vienna. Three years later he launched Asten & Company in Eupen, Belgium, to manufacture woolen blankets and felts for paper machines. Like C. H. Johnson & Sons, von Asten's company eventually found its way to North America and the United States. In 1931 his son Eduard, along with partner Harold N. Hill, established a dryer felt company, Asten-Hill Limited, in Philadelphia, Pennsylvania. Four years later another plant was opened in Valleyfield, Quebec. For its third plant the company looked to the south in the 1950s, opening a facility in Walterboro, South Carolina. Next, Asten expanded its product offering, becoming involved in the wet felt business by adding a new plant in Clinton, South Carolina. The company became a full-line paper machine clothing company in 1969 when it acquired Appleton, Wisconsin's Wisconsin Wire, which was attractive because of its advanced plant technology.

Wisconsin Wire had been founded in 1900 by four area businessmen to produce wire cloth for Wisconsin paper mills. It soon became one of the most progressive companies in its field. It graduated from head weaving to power looms and later developed important new materials and processes, for which it received a number of patents. Wisconsin Wire was also ahead of its time in wanting to become a one-stop shop for paper machine clothing, to supply all three product needs. Asten, already involved in wet felt and dryer felt, agreed with this approach and, desiring Wisconsin Wire's expertise, acquired the business to become a supplier for the total paper machine, which most experts in the industry at the time believed was not practical. Asten's research and development efforts to create new products and improve old ones led to the 1988 establishment of an extrusion plant in Summerville, South Carolina.

COMPANY PERSPECTIVES

AstenJohnson products are at work in mills throughout the world. Our products help create many kinds of paper—from fine writing paper and brown paper bags to cardboard boxes and newsprint.

As the 1990s dawned, all of the Asten businesses were part of Asten Group Inc., which maintained its headquarters in Charleston, South Carolina, employing some 1,800 people in eight divisions in North America and Europe. Half of them were located in South Carolina. In 1995 the Asten Form, Press, and Dryer divisions merged to create a single company, Asten Inc. This move was part of a greater reorganization that included a revamping of the sales and customer service operations and the opening of a consolidated customer service center in Walterboro, South Carolina, in the summer of 1995.

ASTENJOHNSON FORMED: 1999

The 1990s brought consolidation and restructuring in the paper machine dressing industry, so that by the end of the decade there were just ten companies in the field. This number was reduced to a smaller group that became global competitors. With their mutual commitment to championing advances in the paper machine dressing industry, JWI and Asten were a good fit, thus their decision in June 1999 to merge was hardly surprising. By combining their resources, they could bolster their research and development efforts to increase product lines and broaden their distribution capabilities. The deal was completed in September 1999 and the newly created AstenJohnson Inc. began doing business under its new name, operating from headquarters in Charleston. JWI's arrangement with Germany's Heimbach Group remained in effect, which helped the company serve as a global supplier. With 16 manufacturing plants in North America, AstenJohnson ranked as North America's second largest paper machine clothing manufacturer. Heading the company as chairman and chief executive officer was Asten's CEO, William A. Finn. A graduate of Philadelphia University and the Institute of Textile Technology, he came to Asten in 1972 and worked his way up through the ranks, involved in manufacturing, sales, and management before becoming CEO in 1984 and adding the chairmanship ten years later.

Upon completion of the merger, AstenJohnson launched a review to identify the best practices across the organization and maximize the benefits that could be realized from combining the two companies, including cutting costs, streamlining production, expanding research efforts, and improving customer service. In March 2000 the company launched a realignment of its North American facilities, relocating some administrative, sales, and marketing support positions to the Charleston facility. Some production facilities in Jonesboro and Montreal were closed, as was the plant in Summerville, South Carolina, resulting in the loss of some jobs. However, Jonesboro and the Clinton, South Carolina, plant also received major expansions, and several other facilities were slated for expansion and new capital investments. The company's Advanced Product Services Group was also established in Jonesboro and at the Kanata plant, where the Advanced Products Research Group was to be housed as well.

Business was adversely impacted in the new century when the paper industry began to falter after the terror attacks of September 11, 2001. In September 2002, the Wisconsin plant was forced to lay off 22 workers. As the economy rebounded, so did demand, leading to strong growth. However, the important North American market was mature and offered limited opportunities, therefore AstenJohnson looked to open plants in parts of the globe where the papermaking industry was growing and demand for its products was greater, in particular South America, Eastern Europe, and Asia. Since the late 1980s Asia's paper industry had accounted for about three-quarters of all new investments. As the economies in the region, especially China, expanded, their workers gained more buying power and many of the products they demanded contained papers, such as the packaging itself. "Simply put," Finn told the Charleston Regional Business Journal, "Supply goes where the demand is." Asten had anticipated some of these changes back in the late 1980s. In 1988 it established a technical center in Australia, and a sales and marketing joint venture with Heimbach Group in Singapore.

To tap into the market in Eastern Europe where it had never done much business, AstenJohnson began by outsourcing products from a small Czech Republic textile company. Soon the two companies broached the idea of an acquisition and after several months of evaluation, AstenJohnson made a bid and bought the shop in August 2005. While this transaction was in the works, AstenJohnson, in partnership with Heimbach Group, was also building a plant in China called New Horizons Technical Fabrics, which opened in Suzhou Industrial Park in China's Jiangsu Province. AstenJohnson also had to close the Pennsylvania plant in early 2006 because it could no longer supply the markets that were expanding. Most of the employees were relocated to other facilities. At the same time, AstenJohnson expanded plants in Wisconsin and Quebec.

KEY DATES

1790:: JWI Group's predecessor founded in Manchester, England.
1882:: Asten Inc. founded in Vienna.
1901:: JWI operations begin in Canada.
1935:: Asten opens first plant in Canada.
1959:: JWI opens first U.S. plant.
1966:: Asten opens first plant in South Carolina.
1999:: JWI and Asten merge to form AstenJohnson Inc.
2005:: Plant opens in China.

While AstenJohnson planned to follow demand wherever it appeared on the globe, to provide the locally manufactured products that customers demanded, the United States remained the company's primary market and there was no interest in moving the headquarters from Charleston. "We are here to stay," Finn told the Charleston Regional Business Journal. He continued, "It's a great place to live and be based, and it adds character to our company. Besides that, this is a very easy place to attract people to from all over the world." In 2006 Finn turned over the CEO post to president and chief operating officer Daniel D. Cappell, while retaining the chairmanship. A West Point graduate, Cappell was a well seasoned executive, having joined Asten in 1984 after graduating from the Harvard Business School Advanced Management Program.

Ed Dinger