TORONTO - JPE Inc. agreed to acquire Canadian plastic auto parts injection molder and painter Pebra Inc. for about C$30 million (US$22.2 million). JPE plans to keep Pebra management and will continue parts production in Canada, according to Bill Mercurio, JPE's group president for original equipment manufacturers. It has not decided whether to consolidate the production in one plant or keep both facilities operating, Mercurio said in a telephone interview.
Pebra is a Tier 1 auto molder with production facilities in Peterborough and Kitchener, Ontario. Peterborough also has Class A painting equipment.
JPE estimated in an Oct. 11 news release that Pebra's 1996 sales will exceed C$80 million (US$59.2 million).
The deal will round out JPE's exterior auto systems capabilities to include injection molding, profile extrusion and metal forming. JPE announced it was looking to buy an injection molder when it acquired profile extruder Plastic Trim Inc. of Dayton, Ohio, in April 1995.
Its three auto exterior technologies will have combined sales of about $150 million, estimated JPE chief financial officer James Fahrner.
Fahrner said in an interview from his firm's head office in Ann Arbor, Mich., that JPE is not looking to buy another injection molder and it has no plan to change Pebra operations in the near term.
Mercurio said JPE hopes to conclude the deal by Nov. 30. It plans to buy Pebra's shares from trustees in Germany. The trustees earlier this year sold the European assets of its bankrupt parent company Pebra GmbH Paul Braun to Magna International Inc. of Markham, Ontario, for C$31 million (US$22.6 million). Magna and Pebra officials never disclosed why the Canadian operations were not included in that deal, which Magna touted as strategic to boosting its European capacity. Pebra GmbH was based in Altbach, Germany.
Fahrner said JPE plans to obtain debt financing for Pebra debt. Officials would not disclose the amount of debt but Mercurio hinted it is substantial. Pebra employs more than 600 and workers at both of its plants are members of the Canadian Auto Workers union.
Pebra has injection presses up to 4,400 tons clamping force. In the 1996 Plastics News survey of North American injection molders, Pebra stated it had 38 presses and 1995 sales of US$57 million, which ranked it 79th. It makes fascia, body side moldings and rocker panels, mainly for General Motors Corp. It ships most parts to GM plants in the United States and Mexico but does about 20 percent of its business with GM Canada, currently being struck by the CAW, Fahrner said. Its painting capabilities are an attractive part of the assets, he added.
Mercurio said JPE had been negotiating ``on and off'' for Pebra since early this year. Its first offer was rejected and at least one other firm expressed interest in buying Pebra. When those negotiations fell through officials approached JPE to make another offer.
Pebra began switching to thermoplastic injection molding from reinforced reaction injection molding in 1992, 10 years after it began production in Peterborough, its larger plant. It built its Kitchener plant in 1989.