Alfa Laval AB - Surviving the War Years

Surviving the War Years

By the time World War I began in 1914, ABS had acquired shares in Goldkuhl & Broström, Buenos Aires. This was raised to a majority interest in 1927, when the name was changed to Sociedad Alfa-Laval. In 1960, it became a wholly owned ABS company.

In 1915, ABS's John Bernström resigned as managing director and was replaced by his nephew, Captain Erik Bernström. J. Bernström left his post as chairman of the board in 1916, to be succeeded by Ernst Trygger, and his son Richard Bernström was vice-chairman until his death in 1919. The U.S. company Lavalco produced a milking machine in 1918, and four years later the first milking machine based on the Lavalco design was manufactured by ABS in Sweden. In 1922, Axel Wästfelt succeeded Erik Bernström as managing director, and the company Zander & Ingeström became ABS's sales representative for industrial separators in Sweden and Norway. In the United Kingdom, the De Laval Chadburn Company was formed in 1923 for sales of milk and industrial separators. In 1925, an ABS subsidiary was formed in Helsinki, and in 1926 British De Laval Chadburn Company changed its name to Alfa-Laval Company, a wholly owned ABS company. In the same year, subsidiaries were formed in Sydney, Australia, and Palmerston North, New Zealand. Between 1927 and 1929, subsidiaries were formed in Oslo, Warsaw, Danzig, and Zagreb, Yugoslavia.

In 1928, in cooperation with its Swedish competitor AB Pump-Separator, ABS bought the rival company AB Baltic. Only a few months later, ABS acquired its last major Swedish competitor, AB Pump-Separator itself. Both acquisitions, AB Baltic and AB Pump-Separator, had been more energetic than ABS in seeking ways to take advantage of the upswing in trade at the beginning of World War I and had expanded their capacity and grown faster than ABS. These two acquisitions were the most important mergers within the Swedish separator industry.

Key Dates:

1877:
Gustaf de Laval begins to develop the first Swedish milk separator.
1883:
De Laval and Oscar Lamm, Jr., create AB Separator (ABS).
1889:
The Alfa patent is acquired.
1926:
British De Laval Chadburn Co. changes its name to Alfa-Laval Co., a wholly owned ABS company.
1963:
ABS changes its name to Alfa-Laval AB.
1988:
Sharples Separator Co. is acquired.
1991:
Tetra Pak Group purchases Alfa-Laval.
1993:
The hyphen is removed from the Alfa Laval corporate name.
2000:
Industri Kapital acquires the Alfa Laval group.
2002:
Alfa Laval is relisted on the stock market.

In 1930, Jacob Wallenberg of the Swedish banking house Stockholms Enskilda Bank was elected to the board of directors. The U.S. company Lavalco had a bad year and ceased paying dividends until 1935. The German subsidiary Bergedorfer Eisenwerk also operated at a loss until the end of 1933. In 1934, the Alfa-Laval Company (U.K.) moved to facilities in Brentford, near London. A new subsidiary was formed in Melbourne in 1936, and the last important Swedish competitor, Eskilstuna Separator, was acquired in 1939. The outbreak of World War II brought with it an upswing for the U.S. companies. During the war, Lavalco increased the number of personnel from 700 to 2,300, and the U.S.-based Turbinbolaget increased personnel from 1,100 to 2,400. The companies' sales increased by more than five times the prewar figure. More than 50 percent of the Poughkeepsie factory's capacity was taken up by precision work for defense purposes, but at the German factory in Bergedorf manufacture of munitions was extremely limited. In 1942, Francis Arend, managing director of Lavalco, died and was succeeded by Ralph Stoddard, who three years later was succeeded by his son, George. ABS acquired Arend's 10 percent share in Lavalco.

In 1939, Alfa-Laval Company at Brentford began producing industrial separators and milking machines, and increased its sales by 70 percent. During World War II's so-called Skagerack blockade, Sweden and ABS were cut off from many business partners. This period was to be a watershed between the old and the new eras in the company's history.

In the United States, Lavalco was given the task of constructing an oil separator for the U.S. Navy. Orders started pouring in from marine authorities, shipowners, and shipyards. U.K. Alfa-Laval Company became the European development center for these industrial separators. The research-and-development activities were transferred to Stockholm and several engineers were sent away on study visits—to rubber plantations in Southeast Asia, to olive groves in Italy, and aboard whalers in the South Atlantic. Thousands of owners of olive groves and vineyards in Italy and France exchanged their ancient equipment for separators. By 1945, there were hundreds of applications for separators within industry and scientific research.