A May 18 Business article about Sherwin-Williams's purchase of Duron Inc. incorrectly reported the rank of Duron's size in the industry. It is estimated to be the nation's 12th-largest paint manufacturer, not the third-largest. The article omitted the fact that, in addition to paying $235 million in cash for the company, Sherwin-Williams will assume certain financial obligations when the deal closes. The article also incorrectly identified a popular Duron color. It is Shell White, not White Shell. (Published 05/22/04).
Sherwin-Williams Co., the nation's largest paint manufacturer, said it agreed to buy Beltsville-based Duron Inc. for $235 million in cash.
Privately held Duron, founded in the District in 1949, is the third-largest paint-maker with sales of $350 million last year. The company employs 1,800, most in 231 retail stores in the Mid-Atlantic and Southeast.
Cleveland-based Sherwin-Williams said it doesn't plan to cut jobs, and the Duron stores will continue to operate under that name. The purchase requires approval from the federal government.
The paint industry has been consolidating for decades; Sherwin-Williams bought a company in both 2001 and 2002.
Robert Feinberg, Duron's chairman, chief executive and son of the founder, made no secret of his desire to sell the family-owned company as he neared retirement. The 64-year-old art collector, who lives in Bethesda, has no children.
"He believed it was time to exit the business," said Gary Saiter, Duron's marketing director. "This was his succession plan."
Sherwin-Williams, whose paints include the Dutch Boy line, said it would begin using Duron's manufacturing plants in Beltsville and Atlanta. Both will continue to make Duron colors, too, Sherwin-Williams spokesman Conway Ivy said.
Duron's paints, which have coated the White House and the Pentagon, are known for being sturdy, easily applied and relatively inexpensive. The company sells about 95 percent of its paints to professionals, from home builders to property managers.
"They are not known for their color palette," said William Thornton, who owns two independent paint stores in Northern Virginia. But Duron's "white shell," one of its best-selling colors, "is probably the most popular color in new-home construction in this area," he said.
With the addition of Duron's stores, Sherwin-Williams would operate more than 2,900 nationwide. The company already sells 50 percent more paint by volume than its next biggest competitor, Home Depot Inc., said Barbara Allen, an analyst at Natexis Bleichroeder, a brokerage in New York. It had sales of $5.4 billion last year.
Sherwin-Williams wants to maintain its hold on the professionals, a big part of the paint market, a major reason it wants to buy Duron -- in addition to getting two new plants and a couple of hundred stores.
"The hold on the contractor is important to Sherwin-Williams," Allen said. "The trend is not do-it-yourself. It's do it for me. That is why this [deal] makes sense."
The purchase would "further strengthen Sherwin-Williams' lead at the top of the industry," said Eric Bosshard, an analyst at FTN Midwest Research.
Sherwin-Williams bought a company that had grown fairly conservative. In early 2002, Duron said it was abandoning an expansion into the Midwest and selling 27 stores in Chicago, Indianapolis and Ohio to PPG Industries and sticking to its East Coast market so it could "grow more profitably."
Duron had just opened 60 stores in the past five years. But the Midwest stores were the farthest from the factories and would have required the most long-term investment because this was a new market, the company said at the time.
Harry Feinberg, a young chemist in Baltimore, created Duron 54 years ago, buying half of the now-defunct Norman Paint Manufacturing Co. in the District. He had the apparently novel idea at the time of producing paint mostly for professional painters, according to the company's official history. By the 1960s, Duron had grown to a 10-store chain and moved to Beltsville.
Robert Feinberg will remain as chief executive for a year, and Duron said the rest of management will stay in place.
Sherwin-Williams is an even more venerable company, founded in 1866, the year after the Civil War ended, by Henry Sherwin and Edward Williams. It is now one of the largest paint companies in the world.
Its stock fell 80 cents, or about 2 percent, to $36.32 yesterday.