Newcor Inc., a Bloomfield Hills, Mich., automotive supplier with $116 million in 1995 sales, will create a Rubber and Plastic Products group with three companies it purchased in a deal announced Dec. 6. The new group will design and manufacture flexible plastic and rubber parts by dip molding, slush casting, rotational molding and injection molding. Auto-motive is the main market, especially flexible boots for uses such as gear shift lever covers, said John Garber, chief financial officer.
Newcor, publicly held on the Nasdaq, also makes custom machinery systems and precision-machined metal parts.
Newcor announced it bought Boramco Inc. of Walkerton, Ind.; Production Rubber Products Co. Inc. of Livonia, Mich.; and Rubright Industries Inc. of Auburn Hills, Mich.
Garber said all three companies had separate ownership. Newcor announced the purchase of all three at the same time because Newcor had confidentiality agreements with the firms, and they competed against each other, he said. Newcor paid cash, but terms were not disclosed.
All three sales are expected to close in January.
Boramco, Production Rubber and Rubright Industries will join Newcor's Midwest Rubber division, acquired in 1992, in the new Rubber and Plastic Products group. The group will have sales of more than $40 million, Newcor said.
Newcor announced its year-end 1995 financial results on Dec. 7. Those results show little change for sales in the fiscal year, ended Oct. 31, and for the fourth quarter. But Newcor has boosted its profitability dramatically, because of improvements in its biggest business segment - making special machine systems for automakers.
For the full year, Newcor reported profit of $881,000 - with $739,000 of that coming in the fourth quarter. The Specialty Machine Group reported a profit of about $600,000 in the quarter.
In fiscal 1994, Newcor lost $2.2 million, ending with fourth-quarter profit of $90,000. Large cost overruns on several special machine systems hurt results in the fourth quarter of 1994, the company said.
Headed into fiscal 1996, new machinery orders are up, including a multimillion dollar contract from Chrysler Corp. to design and build an assembly system for Chrysler's new 2.7-liter, aluminum V-6 engine, the company reported.
For 1995, Newcor reported sales of $116.6 million, an increase of 4.1 percent from $112 million the prior year. In the fourth quarter, Newcor generated sales of $30.1 million in 1995, a 5.2 percent decline from the year before.