Specialty injection molder American Custom Components Inc. has agreed to buy mold maker K5 Plastics Inc.
The combination ``will allow us to help our customers with time-to-market products,'' John Groom, president of American Custom, said by telephone. He projects annual sales of $10 million on the basis of the firms' upcoming purchase orders.
Managers of Santa Ana, Calif.-based American Custom and Steve Kakuk, K5 owner and president, expected to sign a definitive agreement the week of Feb. 9. The firms signed a letter of intent Jan. 28.
K5 uses an advanced design-to-tooling process in building molds and has worked closely with American Custom for more than a year. Groom envisions closer ties ``between the designer of a part and the person who has to design the mold.''
Kakuk founded K5 in 1983 to consult on the injection molding process and mold making. K5 employs eight and expects to relocate to the American Custom plant, Kakuk said. K5 is currently in Huntington Beach, Calif. It designs and builds customized components for electronic connectors, principally for computer peripherals, medical devices and military systems. It aims to diversify into additional markets.
American Custom operates five injection molding machines, Groom said. The firm plans to add five to 10 machines this year.
In September, the firm conducted an initial public offering of common stock, now trading over the counter with a capitalization value of about $55 million, said Groom.