Behind Belden’s Moves into Signal Transmission

In 2006, Belden, a company long recognized in the automation and control arena for its expertise in wires and cables, started looking to branch out into signal transmission. From the start, Belden’s strategy in this area was to grow through acquisition. The first acquisition Belden made of a signal transmission company was Hirschmann Automation & Control, a Germany-based supplier of industrial Ethernet products. Belden acquired Hirschmann in 2007. Fast forward to fall of 2010 and we see Belden making another acquisition of a signal transmission company — this time it was GarrettCom.

Though both Hirschmann and GarrettCom are well-known providers of industrial networking products, the similarities end there. The major differences lie in the markets they focus on.

Hirschmann products are more focused on factory and process automation applications, whereas GarrettCom is more focused on power utilities, industrial security, and traffic and transportation. According to Frank Madren, president of GarrettCom, his company was focusing on larger growth in power utility business and sought help through acquisition to meet its goals. A key target for GarrettCom is in supplying products for the smart grid.

Another key difference between the two signal transmission companies is that, since its acquisition by Belden, Hirschmann has become a Belden brand. GarrettCom continues to operate independently, but now as a wholly owned subsidiary of Belden.

From an exterior perspective, the products made by Hirschmann and GarrettCom appear very similar. The difference lies in how they are engineered for different markets. GarrettCom products, for example, are designed and tested for NERC CIP compliance in power utilities and are therefore more suitable for outdoor environments. Hirschmann products are engineered for use in factory automation applications where certification such as Class I Div I is required for equipment in hazardous environments.

Aside from the strategic market positioning this acquisition provides Belden, another interesting aspect is the R&D alignment the company now has at its disposal. In the video commentary link below, I explain more about Belden’s plans to align R&D across its Hirschmann and GarrettCom technologies and how cross-company R&D sharing is likely to be the wave of the future in automation.

Automation and Control Video Blog - March 17, 2011