After The Mergers: Smooth Sailing For Legrand's Purchase Of On-Q

"With the Legrand and Greyfox products that came in, it was exciting that you had a whole new variety of products to integrate," says Todd Bunch, president and CEO of Lexington, Ky.-based digital integrator If Walls Could Talk, a dedicated On-Q installer that sells most of the company's products.

The merger has made it easier for the company to buy even more products from one source, which should help the company drive incremental sales, Bunch says. "On-Q has one hell of a product," he adds. "When you can do a full install on a home for $10,000 to $15,000, and you get 90 percent of what a $100,000 system would cost you, that's pretty good value."

Electrical and network infrastructure vendor Legrand North America, based in West Hartford, Conn., bought On-Q Home in February 2005, and merged it with its low-voltage electrical product division, which included the Greyfox company it had bought the previous year. The companies became the On-Q/Legrand division, which is based in On-Q's former Harrisburg, Pa., headquarters.

Legrand maintained the separate product lines of On-Q and Legrand, and launched several new or integrated products to fill in holes of coverage. For instance, in place of On-Q's security cameras that were not IP-addressable and shot only black and white images, integrators can now purchase color cameras that can be accessed online. Integrators have also long praised Greyfox's telephone and other modules, but lamented that they would not fit in any other vendor's structured wiring boxes. Soon after the companies were combined, they developed integration brackets to allow the modules to fit into On-Q's boxes.

"Now that they're a shared company, there are some things I liked better from Greyfox and from On-Q, but now I can get the best of both worlds," says Corbin Hambrick, president of Home Synthesis, an integrator in Kingwood, Texas, and longtime Greyfox partner.

Avi Rosenthal, who was On-Q's national program manager and retained the title at On-Q/Legrand, acknowledges there were some hiccups in product fulfillment following the mergers. For example, orders for On-Q/Legrand's new intercoms were 200 percent above expectations and the vendor had some trouble meeting initial demand, but Rosenthal says those hurdles were overcome.

Integrators say other fears also evaporated. Prior to the merger, Greyfox sold direct to integrators, and many of them feared they would lose their price and exclusivity advantages once Legrand opened the products to distribution. Integrators say those benefits remained. They also worried that help desk, tech support and the number of field sales managers would diminish and that new reps would be unfamiliar with the combined product lines. On-Q/Legrand ended up hiring new personnel, stepping up the training for existing reps and increasing its tech support hours.

Rosenthal and integrators attribute the success of the acquisitions to two main factors: The vendors maintained strong lines of communication with partners throughout the process, and Legrand granted On-Q and Greyfox the independence needed to properly run their own affairs. In fact, On-Q had previously been in talks to be acquired by Levitton, but decided against it, in part because Levitton would have run it as a company division, compared with Legrand, which always planned to give it autonomy, sources close to the deal say.

On-Q/Legrand recently launched a new Web site to help integrators, builders and end users select products and connect with each other. The vendor also created new marketing displays that integrators and builders can use in their offices to demonstrate the vendor's products to customers. With the rich financial support of Legrand, integrators expect additional improvement from the On-Q and Greyfox teams.

"On-Q now has some dollars to spend and so they're able to do more, not only with their Web site but with the customer and builder base they have," says Nick McCullough, president of Norcross, Ga.-based On-Q integrator Link Your House, which recently installed the vendor's marketing displays in its new showroom. "They're offering more services, products, and listening to us as designers and integrators on ways to integrate new products."

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