VKR Acquires Canada's Loewen Windows

Velux parent, VKR Holding of Denmark, is acquiring Loewen, the custom wood window and door maker based in Steinbach, Man., Canada. The move is VKR's second major expansion into the North American market, as it acquired Western Canada's Gienow Group last fall.

“We already own several vertical window companies, and now we extend these activities in Canada and the USA, where the population growth is larger than in Europe," states Leif Jensen VKR's CEO.  Pointing to the severe declines in the Canadian and American markets in recent years, he notes that they are slowly stabilizing, offering much better prospects.

"We see great potential in Loewen, not least because the company holds a strong niche position in the high-end segment of the market and engages in extensive product development," Jensen notes. "VKR Holding has great experience as [the] owner of companies that develop and manufacture vertical windows. We shall therefore have a good chance of benefiting from synergy effects across the Atlantic.”

Started in 1905, the family-owned company maintains its head office and main production facility in Manitoba, but now generates the majority of its sales from the U.S., it reports. The company sells through a network of Loewen Window Centers and Authorized Loewen Dealers in the U.S., and a combination of corporate retail stores and dealers in Canada.

 “Loewen has a leadership position in the luxury window and door market for wood clad and non-clad products, and is a very good fit for VKR’s core values, model company approach, and strategic growth plan," states Al Babiuk, previously COO and now Loewen CEO. "The corporate strategy will continue to be to focus on the luxury segment of the North American market. We will continue with our focus on product and distribution, partnering with our existing dealers and developing new dealers, as well as marketing through our own retail network. The financial strength and corporate capabilities of VKR will provide great opportunity for us to move forward with the company’s strategic plan and develop competitive advantage in North America. Loewen also provides a further platform in North America for VKR to grow its business holdings and capitalize on market opportunities outside of Europe.”

With the new ownership, the existing Loewen executive team will remain in place. In addition to Babiuk, Clyde Loewen remains as executive responsible for products. Charles Loewen will sit as a member of the board of directors of Loewen, while Claes Warnander, a member of VKR’s team, will act as  chairman of the Loewen board.  Babiuk and VKR also note there are no intentions to move Loewen's head office or manufacturing operations.

“Through much consideration, the Loewen family shareholders have come to the collective decision that the needs of the company and those of the Loewen shareholders would be best served through a transition of ownership to a new ownership group," says Clyde Loewen, who leads the Loewen family shareholder group. "The Loewen shareholders believe that VKR will bring the resources, capabilities and character to ensure the future success of Loewen in the marketplace while maintaining respect for
all of its stakeholders as well as for the culture of the staff and the community. The Loewen family
shareholders would like to thank the staff of Loewen, past and present, for their contribution and
commitment to the company over the years.”

As noted, the addition of Loewen follows up on the 2009 VKR acquisition of the Western Canadian operations of the Gienow Group.  Those businesses include Gienow Windows & Doors and Architectural Windows & Doors, both based in Calgary, Alta.; and Award Windows in Edmonton, Alta.

A Window & Door Top 100 manufacturer, VKR employs 14,000 worldwide and reported sales of about
$3.4 billion in 2008.  Its Velux Group, which manufactures skylights, roof windows and accessory products, operates manufacturing operations in 11 countries, including the U.S., where it has a plant in Greenwood, S.C. VKR also owns the Dovista Group of window and door manufacturing companies, which primarily target Northern European markets.