Building a plastics powerhouse through acquisition, Nordson buying Xaloy

By Bill Bregar
Senior Staff Reporter

By Don Loepp
Editor

Published: June 4, 2012 6:00 am ET

Related to this story

Topics Mergers & Acquisitions Machinery Molds/Tooling
Companies & Associations

WESTLAKE, OHIO (Updated June 5, 5:25 p.m. ET) — Nordson Corp. is making another major acquisition in the plastics market, announcing June 4 that it has a deal to buy New Castle, Pa.-based Xaloy Superior Holdings Inc.

Xaloy is the largest U.S. maker of screws and barrels used by injection molders and extruders, and a major supplier of melt pumps, screen changers, cleaning ovens and water-ring pelletizers used by extruders.

Westlake, Ohio-based Nordson, a publicly traded company, said it will pay $200 million for Xaloy, subject to adjustments. The deal is scheduled to close in the third quarter.

Ron Auletta will remain as Xaloy’s president and CEO, a Nordson spokesman said.

A year ago, plastics industry observers might have said “Who’s Nordson?” in response to the company’s acquisition of Value Plastics Inc., an injection molder of single-use medical fittings in Fort Collins, Colo.

But with the Xaloy deal, Nordson becomes a big name in plastics — especially considering that just a few weeks ago it announced an agreement to buy Extrusion Dies Industries LLC, which makes flat dies and extrusion coating dies.

Nordson also is paying $200 million for EDI Holdings Inc., with the final price subject to adjustment.

Nordson will pay for both companies using its existing lines of credit.

Xaloy has operations in the United States, Germany and Thailand, and will become part of Nordson’s Adhesive Dispensing Systems segment.

“By adding this capability to our recent extrusion die product line acquisitions, Nordson now brings the industry a truly unique offering that combines the critical elements of both material flow and dispensing,” said Nordson President and CEO Michael F. Hilton, in a news release.

“This offering is analogous and complementary to the same highly successful model Nordson employs today within its hot melt adhesive dispensing product line for rigid packaging manufacturers.”

Nordson makes equipment for applying industrial liquids, adhesives, sealants and powder coatings, gas plasma and other surface-treatment equipment, for a range of consumer and industrial products.

Officials of Nordson were not available for comment beyond the news release.

Xaloy celebrated its 80th anniversary in 2009. That year the company also made a major acquisition of its own, buying Spirex Corp., its rival in nearby Youngstown, Ohio. Xaloy was already the largest maker of screws and barrels, since it had purchased New Castle Industries Inc. in 2003. The Spirex deal made it even bigger.

The company had expanded into gear pumps, screen changers, cleaning ovens and water-ring pelletizers in 2006 when it bought the extrusion business of Dynisco LLC.

Ownership of Xaloy changed hands in 2008 when Industrial Growth Partners of San Francisco bought the company from another private equity owner, Baird Capital Partners.

Nordson is buying Xaloy from IGP.

One screw industry executive, Glycon Corp. President Jeffrey Kuhman, knew Xaloy was for sale, but he thought it would go to another private equity company. Nordson is a strategic buyer, and because the company is a newcomer to screws, barrels and dies for plastics, Kuhman is eager to know what the strategy is, and if Nordson will bring any new technology to the components sector.

“We think it’s an interesting marriage,” said Kuhman.

He said Glycon, of Tecumseh, Mich., licenses its non-return valves to Xaloy, and buys barrels from the New Castle company.

At the time of the Spirex deal, Plastics News estimated that the combined Xaloy and Spirex had annual sales of about $130 million and about 730 employees.

Xaloy was born in 1929, as Industrial Research Laboratories in California, which developed a hard, wear-resistant iron-boron alloy later patented and trademarked as Xaloy. The company pioneered bimetallic barrels for the plastics industry, and expanded into screws by acquiring Flametech Corp. in 1987.

Xaloy’s plant in Asia is in Chonburi, Thailand, and its European plant is in Neckarsulm, Germany.

Nordson, which is traded on Nasdaq, posted 2011 sales of $1.2 billion and a operating profit of $316 million.


Comments

Building a plastics powerhouse through acquisition, Nordson buying Xaloy

By Bill Bregar
Senior Staff Reporter

By Don Loepp
Editor

Published: June 4, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Reifenhäuser acquires German spinneret company Enka Tecnica

April 17, 2015 9:31 am ET

Germany-based Reifenhäuser GmbH & Co. KG, a major manufacturer of extrusion equipment, has announced that it is acquiring Enka Tecnica GmbH, a German ...    More

Image

Spain's Grupo Antolin to buy Magna's interiors business

April 16, 2015 12:33 pm ET

Spain's Grupo Antolin has reached an agreement to purchase Canadian auto supply giant Magna International Inc.'s interiors unit in a deal valued at...    More

Image

Madison buys Ferry Industries

April 16, 2015 5:22 pm ET

Ferry Industries, the largest manufacturer of rotational molding machinery, was purchased by Madison Industries, a Chicago holding company that is...    More

Image

Caplugs gets new private equity owner

April 16, 2015 11:17 am ET

Caplugs, a major producer of caps, plugs, tubing, netting and other protective goods for industry, has a new owner.    More

Image

A. Schulman, Citadel discuss the $800 million deal

April 15, 2015 1:45 pm ET

The $800 million match of materials maker A. Schulman Inc. and Citadel Plastics felt good from the start. “Everything in our first meetings show...    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 15, 2015 - September 17, 2015Plastics Caps & Closures - September 2015

More Events