An Era of Growth and Focus in Business and at Wilbur-Ellis

In the 1980s, Columbia lifted off in the first space shuttle mission. Tensions between the U.S. and the Soviet Union escalated, then eased, leading to the end of a 40-year Cold War.

The Berlin Wall opened, paving the way for the reunification of East and West Germany. The Internet took shape in academia. And the personal computer experienced explosive growth, transitioning from a hobbyist’s toy to a business and consumer product.

In the business world, a new term was coined – “merger mania.” It reflected the wave of mergers and acquisitions that were happening in industries of all kinds during the 1980s.

The urge to merge wasn’t just a fad. It was driven by tough economic times. To survive, companies needed to become more cost-effective, efficient and competitive. The answer for many was growth and focus.

One way to grow quickly was through acquisitions. Buying other companies to expand operations and become more cost-efficient often gave larger organizations an advantage over smaller companies.

In the U.S., there were other forces at work, too. President Ronald Reagan took office in 1981, establishing new, business-friendly policies that came to be known as “Reaganomics.”

According to a University of Chicago study, the new policies had a big impact: “The easy availability of funds made acquisitions affordable, while the hands-off antitrust policy allowed mergers between two firms in the same industry … The takeover wave of the 1980s also moved large enterprises toward specialization, and away from the diversification of the 1960s.” (Andrei Shleifer, Robert W. Vishny).

Weathering the Storm in an Economic Tsunami

Business-friendly policies couldn’t have come at a better time for the agriculture industry, which was facing an economic tsunami. During the 1980s, the industry experienced:

• A sharp decline in commodity prices,
• Reduced exports (due to a 1980 U.S. grain embargo against the Soviet Union),
• Soaring farm debt for land and equipment,
• High interest rates and energy costs, and
• Plummeting land prices, which led to record farm foreclosures.

Brayton Wilbur Jr., who served as the CEO of Wilbur-Ellis from 1988 to 2000, remembered those difficult years: “In the 1980s, the cost of doing business got so high that, in a way, only the very big could afford to do business.”

So, Wilbur-Ellis – already one of the 50 largest privately-owned companies in the U.S. – got bigger. And we got better, too, focusing on being the customer’s “supplier of choice … with our knowledge, service, technology and integrity,” said Brayton Wilbur Jr. in a speech some years later.

How the Company Grew

In the 1980s, the company grew both through acquisitions and “organic” growth (or expanding its existing businesses). “Wilbur-Ellis doesn’t have strong feelings about acquisition versus expansion,” Brayton Wilbur Jr. said. “Each has its strengths and weaknesses.” About acquisitions, he said: “It’s relatively easy to purchase something … but it’s hard to purchase it well,” acknowledging the challenge of buying the right asset at the right price.

Still, for Wilbur-Ellis acquisitions came at a steady clip. Many of the companies purchased were small entities – but together they added up, Wilbur noted. And some played a particularly important role in the company’s history – like the acquisition of Brayton Chemical Company in 1985. This acquisition strengthened the agricultural chemicals operation in the Midwest and mid-Southern states, at the same time the company was expanding in California and Texas.

Brayton Chemical also would become even more significant in the 1990s, when it entered into a joint venture with Farmland Industries, the largest U.S. farmer-owned cooperative (see next month’s “1990s – Through the Decades” story for more on this pivotal JV).

Another acquisition, Tide Products, expanded the agricultural chemicals and fertilizer business in Texas, along with the Tex-Ag Company. Rigo Company also joined the Wilbur-Ellis portfolio as a formulator and marketer of pesticides.

“Since the early days, growth through acquisition has played a big part in the company’s success,” said John Thacher (left), the current Executive Chairman of the Wilbur-Ellis Board of Directors, former CEO, grandson of company founder Brayton Wilbur Sr., and son of former CEO Carter Thacher.

“Acquisitions have brought some great people to Wilbur-Ellis. When we make a decision to acquire an organization, we look at more than just the operating assets and the balance sheet. We look at the people who will be joining us, because the values, energy and talents they bring to the company really determine if an acquisition will be successful.”

How the Company Focused

Company leaders, including Connell head Paul O’Leary (second from left), and government dignitaries celebrated Connell’s return to Shanghai, China, in 1986.

The move toward greater focus in the 1980s was exemplified by Connell. The business intensified its focus on specialty chemicals and ingredients in Asia-Pacific, the geographic center of Connell today.

1986 was a particularly important year. That’s when Connell – after a 36-year absence – returned to Shanghai, China.

This part of the Connell story goes back to 1950, when the business had to close its Shanghai office and leave China following the 1949 Chinese Communist Revolution, which established the People’s Republic of China.

So, it was a momentous day in 1986 when Connell was welcomed back to Shanghai. The company was greeted with celebrations, ribbon cuttings, toasts from government dignitaries, and a reunion of former Connell staff. The ceremonies were even televised nationwide to 300 million viewers across China.

In remembering the return, Paul O’Leary (who led Connell at the time) said an important reason Wilbur-Ellis was among the first U.S.-based companies invited back to China was because of the way we departed. “When we left China, we paid off all the retirement pay … paid off the whole staff completely. The Chinese never forgot that.”

While this chapter of our history is memorable, Connell’s connection to China is much deeper, dating back to 1898. That’s when Connell founders, Morris and John Connell, opened their first overseas office in Shanghai.

At the same time Connell was refining its focus, other parts of Wilbur-Ellis were doing the same. In the 1980s, the agricultural inputs and feed operations functioned as one business. But as each market grew, it became clear that they could better serve customers by becoming separate businesses. And that’s when the Agribusiness and Nutrition (then called Feed) divisions were formed.

Today, Agribusiness and Nutrition – along with Connell and Nachurs Alpine Solutions (acquired in 2019) – make up Wilbur-Ellis’ four core businesses. In 2016, the company created Cavallo Ventures, Inc., which serves as the venture capital arm of the company. Cavallo Ventures invests in early-stage and start-up companies, supporting the development of new technologies and innovations that support Wilbur-Ellis’ core businesses.

A New CEO Outlines His Vision

As the decade drew to a close, in 1988 Brayton Wilbur Jr. (left), son of founder Brayton Wilbur Sr., became the company’s new CEO. As he looked ahead, Wilbur talked about his vision for the company’s future in agriculture:

“We intend to be the finest purveyor of agriculture services. We want to run the best and very profitable retail units. We want to have the ability to service the wholesale business where it makes sense. And we want to be on the cutting edge of the new agriculture, with precision farming, global satellite positioning, specially bred herbicide resistant seeds, and genetically altered seeds, when accepted by consumers in Europe and the U.S.”

Wilbur also talked about the company’s expanding scope: “We want to provide the technical information that customers are willing to pay for. We want to provide record-keeping, in other words precision services, whether in the prescribing of the chemicals and fertilizers for growers to use, or bringing them correct products and services for their crops, so they are the most efficient, lowest-cost, highest-yielding producer of whatever crops they grow.”

In his dozen years as CEO, Brayton Wilbur Jr. pursued the vision he described, recognizing that technology and innovation would play an increasingly important role.