Why was Patrick Paige the ideal CEO for this integration?
Vincent Fandozzi: Patrick has 32 years’ experience in industrial companies and the job we asked him to do was to turn this into a truly global organization, as opposed to a set of global assets. He has created a team at the top of the company and now they’re setting out a five-year vision for the business. The work Patrick and his team are doing backs up our investment thesis when we underwrote the transaction, which was that these were strong companies with great customer relationships and putting them together would give us a broader set of opportunities. But it needed melding into one management team with a single vision. We can see that happening now and we’re starting to see the benefits of creating a single, global organization that can do more for its customers. For example, Ford had never given business to Huron outside North America, but now we’ve qualified our Polish plant and we’re getting business from Ford in Europe for the first time. We’re also talking to customers about other significant projects, so we’re starting to see what this business is capable of, once it’s been properly integrated.
We had strong products and customer relationships, but we are now putting systems in place to allow us to operate as one very strong and highly profitable global unit.
What have your priorities been since you took over as CEO in early 2018?
Patrick Paige: My first job was to create a stronger organization at the top. I’ve brought in a new CFO and a new head of HR, and we’ve promoted internal candidates for the Chief Commercial Officer and Chief Information Officer roles. Then we worked on creating one organization from the companies that Ardian merged to form HDT: Huron, which was US-based, and Dynamic Technologies, which had nine plants outside the US.I soon realized that every plant had different operating systems and practices, so effectively we were ten separate businesses, not two. The group was extremely fragmented and many of the people running the plants had never met each other. Likewise, many senior managers in the company had never met in person. We had strong products and customer relationships, but no systems in place to let us operate as one global unit. We’ve made progress in this regard but we still have much work to do. However, what made the first few months even more challenging was that in Canada we were building up for the biggest product launch in the company’s history and the plant there was having problems. I knew before I joined that we needed to improve our operations significantly and we started with Canada. In 2018, I spent 80% of my time there–we’ve now implemented lean operating principles and we have strong traction. We finished 2018 much stronger than the year started and 2019 may be the best year in the plant’s history.
What are your major objectives for the company now?
P.P.: Now that we’ve got a plan to install the same operating system in every plant, I’ve brought together our top 17 executives globally to develop a strategic vision, supported by a detailed plan for HDT. We’re confident we can deliver tens of millions of dollars of operating improvements over the next few years and generate very strong organic growth in both revenue and EBITDA. We’re also looking carefully at the opportunities in electric and hybrid vehicles. Our major expertise is in cooling systems for vehicle powertrains and the number one challenge the electric vehicle market faces today is cooling the batteries. The engineering principles that apply to our cooling systems are transferable, so a big objective for me is to position us for success in battery cooling systems and technologies for electric vehicles.