Asaba Group Holdings on Victor Edozien The Prince Of Steel
Nigeria-American businessman, Victor Edozien, has quietly built a $400m portfolio in the American automotive manufacturing industry. He towers elegantly as Nigeria's image builder in the global community.
220 North Main Street Suite 102 Natick, MA, June 19, 2015 (Newswire.com) - MANUFACTURING plants across the United States of America have faced steady close-downs as businessmen move their operations to Asia and Latin America to reduce cost and optimise profits. This has led to high unemployment and dislocation, leaving industrial centres such Detroit in ruins. If the situation is to be resolved however, it will be due to brave souls such as Nigerian American investor and business personality, Mr. Victor Edozien, whose string of plants are keeping thousands of people in jobs and last year returned a healthy $400million turnover.
Edozien’s Asaba Holdings operates manufacturing, consulting and lifestyle businesses and has operations in five states in the US. Its portfolio companies include the AG Manufacturing Inc, which is an Electrical and electronics sub-assembly manufacturer for the automotive, marine and military defense industries; the SET Enterprises, which is a major provider of steel processing services to the automotive industry and the Asaba Group which offers strategy consultancy to the automotive industry and the US Air Force. The companies operate manufacturing plants in Michigan, Illinois, Alabama and Indiana.
‘We have a portfolio turnover of $400m last year and our goal is to reach $1billion by the end of the decade,’ Edozien told The Guardian at his office located on the 66th floor of the iconic Empire State building in New York. ‘The basics are there. We have over 700 highly motivated employees and our businesses are well run.’
It is hard not be infected by Edozien’s optimism about the ability of his businesses to continue its dizzying growth, after all the total portfolio turnover of the operation was a mere $1.2million in 2004. So, how has this man, who grew up in Nigeria been able to leverage his talents to build a successful business in the United States?
Edozien said: ‘What I do is seek competitive white space to invest in. I usually use my own money to do business, so I have independence in decision-making. But I also have a strong management team to run the various operations. I rely on them a lot. I just provide guidance and strategic visioning. The crucial question for us is always, is there opportunity for us to move in? Once this is clear, I take the decision to invest or not.’
A Nigerian Life
Born in New Jersey, but educated in Nigeria up till undergraduate level at the University of Port Harcourt, Edozien – a scion of the Edozien royal family of Asaba – dropped out of school to relocate to the United States in the 1980s where he obtained a Masters’ degree and served in the US army, 10th mountain division.
‘I gained a lot from the military experience,’ he said. ‘The US military is one of the best in the world and you leave with focus and belief that you can do anything. The slogan used to be: ‘be all you can be’. Does that give you the grounding to take on life’s challenges, of course it does. I just see hurdles as challenges and I move ahead to climb it.
‘When I was at Uniport, I wasn’t the most disciplined student. That was the time of Andrew and I was one those that checked out and never looked back. I did two years in Geology at Uniport and transferred to Syracuse where I got a super education.’
After school, Edozien worked on electrical controls for air-conditioning, from 91-92 and was part of the team that designed the now ubiquitous remote control system for split-unit air conditioners. ‘I have a patent for one of those designs’ he said.
But he always wanted to be at the business end of things.
‘The quantitative side of me is where I am more comfortable and that works fine in Finance, but the human relations part is the weak spot. I started working to get on with the business management side of things.’
He started a consultancy, the Asaba Group, which had a good client list including General Motors, Chrysler and Ford. It even executed contracts worth $20million for the US Air Force.
‘I was making quite a lot of money out of the consulting,’ he said. ‘But I still wanted to be in a situation where I moved away from giving advice to doing things. I want to run better-managed and more profitable companies. I always have my eyes on the automobile industry because most of my clients on the consulting side are in the industry. I tried to convince people to buy non-performing firms in the sector. I talked to a lot of people in Nigeria to join me, but they did not want to invest. So, I stopped trying to depend on anyone for what I do.’
Edozien decided on his first acquisition when he came across an electrical parts manufacturing company that was dying.
He said: ‘I was working with Chrysler and there was a contractor that had moved all its plants minus one to Honduras and China. There are characteristics of some plants that do not lend itself to being moved away. So, I moved on the plant. It cost $2million and from that point onwards, I put myself in a situation where I am able to take advantage of such opportunities in the industry.’
However, it was not easy turning the plant around. Edozien and his friend and financial adviser, Michael Oniamwah (also a Nigerian-American) worked for almost three years to turn the business around. But first, they had to convince the entirely white staff that they are who they claim to be. And a major newspaper did not help matters by carrying a story that appears to condemn the plant before the new owners even had a chance to start implementing their turn-around plan.
‘You can imagine the shock on the faces of the staff when, after closing the buy-out deal, we walked onto the floor of the plant to say we are the new owners,’ he said with a chuckle. ‘We were the only two black people within a 150 mile radius – and we are the new owners of the plant! Two guys with Nigerian accents and we told them we just bought the business. They were all just staring at us.’
Until one person spoke what was uppermost in the minds of the staff at that time: when were they getting paid? It was near Christmas and the former owners had not paid the salary.
Edozien promised they will get paid, and they were. Although the company lost money the first two years, and had to rely on cash injections from the Asaba Group consulting business, it finally became profitable and now has an annual turnover of $35million. The company, which has 250 people on its payroll, is the second highest employer of labour in the town of Habour Beach, Michigan.
His next set of acquisition was the SET Enterprises, with plants in Michigan, Illinois and Alabama. Perhaps the SET plant in Detroit is a good example of the force for good that businesses such as Edozien’s could become in a society. The plant is located smack in the middle of decaying Detroit, with boarded-up and crumbling homes within its immediate vicinity. Staff of the plant gamely tried to keep public facilities such as community parks going. Of course, each of the huge plants also depends on power – and this means Edozien could not even think of moving any to Nigeria.
‘You see how much power they depend on,’ he told The Guardian during a trip to the SET flat rolled steel plant at New Boston, Michigan. ‘If I don’t have constant power, we can’t work. So, it is going to be hard to move any of the operations to Nigeria, but it is not impossible.’
Edozien was a partner in the SET operations before he bought out the owner. So, how risky is it to partner with him, seeing as he is past master at consolidating businesses he is involved in. He said, with an easy smile, it is not really a risk.
‘The thing is, I make money for people. The only people who are not happy with me are those who try to double cross me,’ he said.
Double-cross is not uncommon and Edozien has battled through a few. In fact, he only last March won a two-year-old legal suit against former partners- turned- adversaries, who wanted to usurp his rights to global energy drink, Cintron. The legal battle was costly – about a half a million dollars in legal fees – and draining. But Edozien said the brutality of the case provided further motivation for him to take his businesses even higher.