AB Plastics Corp., a custom injection and structural foam molder in Gardena, Calif., announced it will sell a majority of its stock to a joint venture that includes the owner of a Florida-based custom molder. The joint venture partners are: Compass Plastics & Technologies Inc., a management company in New Canaan, Conn., owned and operated by plastics industry executive Michael A. Gibbs; and Private Equity Partners LLC, a venture capital firm based in New York. The agreement is scheduled to be completed this month.
AB Plastics President Jim Adams said the equity sale will provide the firm with expansion capital, and a ``board of directors experienced in helping family-owned businesses attain new levels of corporate maturity.''
The company molds television housings, consumer electronics enclosures and computer monitors for a variety of original equipment manufacturers including Sony, Matsushita, Casio and Hitachi.
Gibbs said that as a stockholder in Summit Plastic Solutions Inc., headquartered in Daytona Beach, Fla., he expects that AB and Summit ``will develop a working relationship,'' even though the two companies will not share ownership.
``We're already working on one project that requires both East and West Coast molding capabilities,'' Gibbs said in a telephone interview.
Also in the works is a new facility in Mexico. Details are not available, however, Gibbs said plans for the molding plant are customer-driven.
``We have a 23-year relationship with Sony and hope to grow with them as well as other customers with facilities in Mexico,'' he said.
AB Plastics, a privately held firm, had sales of more than $40 million last year. John Macauley, AB sales manager, said the partnership will provide opportunities for the company it would not have on its own.
Other plans for AB include obtaining ISO certification, expanding the company's engineering capabilities in robotics, process control and mold design, and increasing its gas-assist capacity, all within the next year. Also, the company will begin evaluating alternative methods for electromagnetic and radio frequency interference shielding.
AB's existing management team and 300 employees will remain with the company. The only personnel changes expected are the expansion of AB's sales staff and the addition of a full-time chief financial officer. Three members of the founding Adams family will remain on the firm's board of directors, and together with other key managers will own one-third of the company.
Gibbs said that with 27 injection molding presses-14 with more than 700 tons of clamping force and half of them less than 3 years old-AB Plastics is ``well-positioned to do much more than it has in the past.''
AB's presses have clamping forces of 60-1,800 tons. It also offers assembly, heat staking, hot stamping, pad printing, sonic welding and silk screening. Its decorating department also contains one of the largest painting facilities in Southern California.
AB Plastics, founded in 1952, occupies a 97,000-square-foot manufacturing facility and two separate warehouses.