138-year-old Twin Cities company changing industry with more environmentally friendly adhesives

H.B. Fuller is 138 years old and one of the largest companies in the world that focuses solely on adhesives.

But in the past three years, the Vadnais Heights-based company has been acting like a startup.

Since Celeste Mastin became CEO in December 2022, the company has completed 11 acquisitions.

At the same time, it has put more emphasis on research and development.

“Even though they’ve been around for a long time, H.B. Fuller is acting like the upstart and driving innovation in that industry,” said Pete Johnson, a portfolio manager with Mairs & Power, a St. Paul based investment firm that is a major shareholder in H.B. Fuller.

It has to, said Xinyu Du, the company’s senior vice president of global R&D. Otherwise, it risks losing its position to smaller, more nimble companies.

“Our mission is really to lead the whole industry towards the next generation,” Du said.

Harvey Benjamin Fuller started his namesake company in St. Paul in 1887 with a product known as “Fuller’s Premium Liquid Fish Glue.”

Today, the company with over 7,500 employees produces about 300 new products annually.

The adhesives industry is dominated by Henkel, a Germany-based consumer products and adhesives company. Other competitors include Maplewood-based 3M Co., plus PPG Industries, BASF and Arkema.

The global adhesives and sealants industry is expected to grow from around $82 billion to $118.8 billion by 2032, according to a Fortune Business Insights report.

Fuller’s innovation is key to grabbing its share of the growth. So far, so good. Products introduced over the past five years produce 22% of Fuller’s revenue, which was $3.6 billion in its last fiscal year.

“That’s a terrific number to be at,” Johnson said.

Over the past three years H.B. Fuller has increased its R&D spending, averaging $47.7 million a year over those years.

At the same time, Mastin has brought more operational rigor to the company during her tenure. Earlier this year, the company announced a plan to restructure its manufacturing operations and supply chains with hopes of generating $75 million in annualized cost savings by 2030.

The company makes more than 20,000 adhesives for more than 30,000 customers in industries from construction to hygiene and health.

Its latest product is called Millennium PG-1 EF ECO2, a spray-on sealant that allows commercial roofers to bond different layers of roof insulation on flat roofs.

It also makes use of naturally occurring gases in the propellant to make the roofing projects more sustainable, a big goal for H.B. Fuller products.

The company’s two growth strategies, acquisitions and innovation, come together with Millennium.

The roots of the product go back to two acquisitions: Fuller’s 2017 acquisition of Royal Adhesives gave the company entry into the roofing adhesives market. A small 2020 purchase gave them new spray technology.

Spray adhesives are easier to apply and less prone to leaks than mechanical fasteners and help customers in a tight labor market, the company said.

“Labor shortage is certainly a driving factor in canisters versus a traditional kind of application for adhesives,” said SuAnne Stevens, global vice president of commercial roofing at H.B. Fuller.

The product comes as a kit with two 20-gallon cylinders of adhesives similar to propane tanks you might use in your backyard grill as well as hoses, the applicator and necessary accessories.

That custom applicator mixes two components in the proper ratio.

The new product’s technology anticipates regulatory changes on the use of greenhouse gases hydrofluorocarbon (HFCs) and hydrofluoroolefin (HFOs) that have been used by H.B. Fuller and others in the industry as the main propellants in spray adhesives.

Millennium swaps out the HFCs and HFOs for normal atmospheric gases, CO2 and nitrogen, in the pressurized cylinders.

“This is definitely a premium product for us,” Stevens said.

No matter where innovation comes from in the company, resources are leveraged from across the organization.

“We have a very integrated approach to innovation and collaboration across the business,” Stevens said.

A number of internal teams work on new products from customer research and operations to technical groups and manufacturing.

The teams also take a “voice of the customer” approach.

“We innovate with our customer together,” said Du, the global R&D senior vice president.

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