By Matthew Spieler
Hicksville, NY—Less than six months after Pfleiderer AG acquired Pergo, the company has named George Kelley president and CEO of the newly integrated flooring companies Pergo and Uniboard.

As part of this restructuring, Kelley will oversee and direct all aspects of the North American flooring business. He replaces Tony Sturrus, who resigned earlier in the month from this position. Pfleiderer said Sturrus also relinquished his duties as CEO of Pergo AB in order to pursue other personal interests.

Succeeding Sturrus as Pergo AB’s CEO is Pfleiderer board member Michael Ernst. Also, Frida Rosenholm has been elected deputy CEO of Pergo’s European operations.

Kelley comes to Pergo after serving seven years as president and executive board member of Virginia-based Böhler-Udde-holm Specialty Metals, the North American production and sales division of High Speed Steels and Powder Metal-lurgy. Prior to joining Böhler-Udde-holm he held similar positions at Zapp USA, which specializes in high-precision cold forming and sales of metals.

In addition to Kelley’s appointment, the integrated companies feature executives from both Pergo and Uniboard. For example, former Maytag executive Tad Schimmelpfennig, who joined Uniboard at the beginning of the year, is now vice president of sales of the combined operations, while Pergo’s David Small remains as marketing director. Other senior officers include Christoph Schmitz, CFO, and James Hogg, COO.

As part of the consolidation, the North American headquarters will be based at Pergo’s Raleigh, N.C., facility. Some personnel will remain in Lavel, Quebec, Canada, where Uniboard was located.

During an exclusive interview with FCNews, Kelley said combining the resources of Pergo and Uniboard creates a company better able to compete in today’s highly-competitive market. Plus, the two entities already have some familiarity as there existed a customer/supplier relationship.

“With both companies part of Pfleiderer,” he explained, “it makes sense to consolidate sales, streamline the products and fully utilize each company’s facilities so there will be no more outsourcing. We’re focusing on the many synergies as well as the best ways to share resources to ensure Pergo’s success.”

Focus on retail

A major part of this focus is on the specialty retailer segment, an area Kelley said Pergo needs to “re-invigorate. The Pergo brand has to have a clear differentiation—it’s not rocket science. We need to regain consumer confidence and spending habits. Let’s face it, the last six months have not been a boon to the floor covering industry.”

In his new position for only a few days, Kelley showed how serious he was about focusing on the retailers by hitting the road and visiting a couple of Pergo’s largest accounts.

“They were very positive,” he explained. “They’re understanding of the situation and also recognition of Pfleiderer as our parent company gives us long-term stability.”

Kelley noted Pfleiderer has been in the engineered wood business for more than 100 years, meaning it has a long track record of success with a solid foundation. Knowing that, customers can expect a strong effort to help them be successful. “With today’s market conditions being very challenging, many are looking forward with an optimistic eye.”

In addition to meeting with key customers, Kelley also met with all staff—from the manufacturing floor up to the administrative team.

“I want to make sure everyone understands we now have sound, supportive ownership,” he said, “not to mention a company that is not afraid to invest in new machinery, technology and resources. The important thing is that we are all on the same page. These are people who have been in the shadow of the company while it was for sale, so our job is to regain their passion and re-invigorate the Pergo brand.”

Most of the focus right now is on the Pergo side of the business, and rightly so, as it is the category’s best known brand. Plus, “the company has invested too much time and effort” to create value and equity in the product.

Kelley said the Uniboard brand is something the company “needs to get its arms around” to determine how best to utilize it.

At the time of his interview with FCNews, he noted it was still too early in the process to divulge all details as “not everything is fully figured out.” Kelley did say that sales are part of the integration, and the overall product mix needs to be figured out. “Obviously we will continue to have specialists in their respective markets and products that meet the various needs of consumers.”

Fundamental similarities

Even though Kelley comes from outside the flooring industry, he said the overall goal is the same—to be profitable. “I’m finding it amazing to see the fundamental similarities in how each goes about achieving that goal. The most important is to have a product offering that is the right fit for your end client.”

The challenge, though, is being successful at retail, an environment, he noted, is ever changing. “But, Pergo’s brand and what we are doing in R&D will separate us. This is one of the ways to help re-invigorate the brand as well because our new products will show we are not just a generic product and will prove we have something special.”

Having new and differentiated products is one area Kelley noted where Pergo is making an additional commitment to the specialty retailer. And, later this summer, a new consumer advertising campaign encompassing print, cable TV and the Internet will further reinforce that pledge.

In the end, he said Pfleiderer’s goal is for all its divisions to be profitable. And the only way for the flooring unit to be so is to satisfy both the specialty retailer and the consumer. “Making end users happy with their purchase will make the dealer successful, which makes us successful—it’s not rocket science.”