Latham Pool Products has purchased a second automatic cover company.
Effective Oct. 1, the Latham, N.Y. manufacturer owns Pool Cover Specialists of West Jordan, Utah. This adds to the Coverstar line, which Latham purchased in 2006.
“They’re a highly respected, well-regarded brand,” said Mark Laven, president/CEO of Latham. “Prior to our acquisition of Coverstar, we were handling PCS products and reselling them to our package pool dealers.”
Formerly known solely as a vinyl-liner package-pool producer, the company has expanded over the years through acquisitions to offer fiberglass pools, steel pools, safety covers and automatic covers.
This is Latham’s fifth acquisition in five years, its 12th in 10 years. The most recent have largely been to expand the fiberglass division, with the purchases of Blue Hawaiian Pools and Trilogy Pools in 2010 and Royal Fiberglass Pools in 2012. Last year, Latham purchased Plastimayd, a maker of vinyl liners and safety covers.
Automatic covers gained a place in Latham’s strategy due to their product’s growing market penetration. Ten years ago, they sold with approximately 15 percent of new pools; today they are included in closer to 25 percent, Laven said.
“Even though the market has remained somewhat flat over the past five years, the rate of penetration of automatic covers on new pools being installed in the U.S. has grown pretty consistently, and we think that trend is likely to continue,” he said.
The timing also was right for Pool Cover Specialists, as co-chairmen Wes Mathis and Dave Dalton were ready to retire, Laven said. PCS manager Bruce Grogg, who has handled the day-to-day operations for a while, will serve as general manager of the PCS brand.
The purchase immediately expands Latham’s global reach. Latham had a minor presence in Europe and the Mideast, but PCS bolsters representation in those areas and takes the company into the Australian and New Zealand markets.
As it has done after just about all of its acquisitions, Latham will retain the Pool Cover Specialists brand as distinct from Coverstar. “There’s very little overlap in customers ...,” Laven said. “The features and benefits of each product are somewhat unique and will be maintained.”
It isn’t known whether PCS’ 60 employees will remain. Laven said it also will take some time to decide whether to keep the acquired company’s current Utah headquarters or its Knightstown, Ind. plant, though he doesn’t expect any changes in that respect in the immediate future.
“There’s not a lot of time between now and the 2015 season,” he said. “I think it’s early days, and … we can’t force those kinds of decisions.”
In quicker order, Latham expects to shorten delivery lead times and reduce stockouts of PCS products. “We can make an investment in inventory and do things that a smaller, independent owner might not have been [able] to do,” Laven said.
This also marks the firm’s fifth acquisition since emerging from Chapter 11 bankruptcy in early 2010, when it became a portfolio company of Greenwich, Conn.-based private equity firm Littlejohn & Co.