Cavagna: Wind in the sails

With the wind in its sails, that journey has propelled Cavagna towards completing a string of acquisitions and investments, and its voyage is showing no sign of slowing as the group celebrates its 70^th anniversary this year.

Founded in 1949, the family-owned Cavagna Group’s anchor lies in Brescia, Northern Italy, which is historically known for its metalworking tradition.

The family describes its location as its core strength, with the inherent knowledge of the ins and outs of non-ferrous metals a major plus in terms of the group’s capabilities.

That knowledge translated into a major market advantage and today, the corporation delivers approximately 50 million valves and regulators each year in more than 145 countries via a worldwide network of 27 fully-owned distribution and manufacturing companies.

Now under the leadership of the family’s third generation, the Cavagna Group has emerged as a true world benchmark for the major gas players.

In celebration of the group’s milestone anniversary, gasworld spoke exclusively with Miriam Cavagna, Head of Marketing and Communication, to learn about the company’s history, evolution and future plans.

The foundations for a career in the gas industry were laid at an early age for Miriam, who would travel with her father Gian Battista Cavagna on his business trips as a little girl.

“I wanted to follow in my dads’ footsteps, but it was also my calling, and there was no doubt about what I would end up doing when I grew up: I would be working in the gas industry,” she said.

Upon finishing her degree in Public Relations and the Science of Communication at IULM University in Milan, Miriam joined the Cavagna Group and ran local branch operations for seven years.

In 2008, she worked as a business intelligence manager before serving in the marketing department, first as marketing and communication manager before moving on to her current role today.

Family model

Seven decades earlier in 1949, Paolo Cavagna (left), Miriam’s grandfather, had an idea. A talented artisan who was trying to emerge in the continuously expanding industrial centre of Lumezzane, Paolo had the idea of designing a new kind of guard for cylinder valves.

“Paolo was stubbornly independent and never afraid to try something new,” Miriam recalled. “He left the company he was originally employed at and started, along with his older children, the Cavagna Group from scratch. He founded ‘Cavagna Paolo & Figli’ (Cavagna Paolo and Children).”

“From what I have been told, there was no profit for years, let alone any legacy to protect. The burden would be borne by future generations.” 

During the time the roots of the Cavagna Group were developing, the Lumezzane district was coming out from a war that had caused the abandonment of a great part of manufacturing production.

“Thanks to a great number of patents that were applied for in the post-war period, companies went back to the productions that had been left aside and entered into a period of reinvigorated vitality,” Miriam explained.

“The two main productions were crockery and cutlery on one side and valves on the other. We followed the strand of valves.”

According to the Cavagna Group, entrepreneurial vocation is an additional distinctive trait of the Lumezzane district. Whilst Paolo was starting up Cavagna, many others left companies where they were employed to create new ones of their own.

Through this way of thinking, the companies of the district grew at an unstoppable pace. Even when the expansion slowed down, Lumezzane was able to reinvent itself.

“The Cavagna Group is proud to be considered as part of this system of companies and people, unique in its genre, based on the strong values that have always characterised the group throughout the years and that have made it the organisation it is today,” Miriam said.

The high sense of responsibility, the spirit of sacrifice and the complete commitment to work are the fundamental principles for the Cavagna family and the entrepreneurial family model.

Global trail

During Italy’s economic miracle of the 1950s and 1970s the small business started to become more and more relevant in a rapidly growing Italy.

But the decisive breakthrough for the future of the company was the idea of designing a new kind of hand-wheel for cylinders valves. In just a few months, the company expanded and definitively entered the gas world.

Throughout the years, and always under the Cavagna family’s guidance, the company changed its seat and became a group, increasing and diversifying the internal manufacturing processes and developing strong long-term collaborations at an economic and institutional level.

The Cavagna family started by addressing production towards three macro areas: liquid petroleum gas (LPG) valves and tank accessories, LPG regulators, and valves and regulators for the compressed gases – medical, industrial and specialty in the late 1970s.

The group entered a busy period of market expansion in the 1980s with the start of a series of mergers and acquisitions around the world.

“I think Cavagna’s growth is strongly related to the family members involvement and commitment, adherence to ‘family-run’ principles and certainly the presence of a competitive advantage, with a little bit of luck!”

Historically a competitor in the production of industrial, medical and specialty gases valves and regulators, the Cavagna Group acquired Pergola in 1993, followed by Danish company Kosan Teknova in 1999, Italian regulators manufacturer OARA and valve manufacturer OMB in 2001, and Santiago-based Chilean company Cemco in 2010.

The same decade of expansion had also seen the Cavagna Group commit to the establishment of an entirely owned production plant in China dedicated to the manufacture of LPG and natural gas regulators (2005) and the entry into a joint venture agreement with Mesura France for the manufacture of natural gas regulators and smart metering regulating systems (2009).

In late 2011, the Cavagna Group made the total acquisition of SVM/Cavagna in Thailand, quickly rebranded as Cavagna Group Asia, providing the company with a firm foothold in the rapidly growing Southeast Asian market.

More recent activity has seen the takeover of Mesura and the Mesura joint venture in Tunisia (2012), the establishment of UK-based Greengear Global (2014) – a Cavagna Group company that specifically deals with the manufacturing, marketing and promotion of Greengear-branded products – and the acquisition of Bigas International Autogas Systems (2015).

In November 2015, the Cavagna Group finalised the purchase of the Gas Equipment Factory’s assets from Afrox. With this acquisition, the company acquired a range of products to complete its own line of industrial regulators as well as high-tech pressure reducing valves for medical gases.

2016 saw the group enlarge its LPG business platform by purchasing Turkish company DVR’s line of LPG valves and regulators (November) and widen its range of products and services in the natural gas industry with the takeover of Milan-based STF Gas (December).

Last year (2018), the company acquired Qgas, an Italian producer of diaphragm meters and systems for measuring and monitoring natural gas and LPG. This takeover marked another step along the group’s path towards a full range of integrated solutions for the gas industry.

Most recently, the Cavagna Group established a new import/export company in China called Zhongshan Cavagna Import and Export (January 2019).

“I think Cavagna’s growth from a small company in Lumezzane to an international industrial group over the last 70 years is strongly related to the family members involvement and commitment, adherence to ‘family-run’ principles and certainly the presence of a competitive advantage, with a little bit of luck!” Miriam said.

“I think we succeeded because we are quite flexible, we invested profit in the business and we invested for the long term, even in difficult times.”