Injection mold makers Tradesco Mold Ltd. and Fairway Molds Inc. have merged ownership, and the newly formed company plans to make additional acquisitions.
New York merchant bank Castle Harlan Inc. formed StackTech Systems Inc. while it completed the purchase of Fairway on Sept. 11 for $12.8 million. StackTech is a holding company with majority ownership of Fairway and Tradesco. Castle Harlan has been majority shareholder of Tradesco since 1996.
Tradesco in Toronto specializes in stack molds and high-cavitation, hot-runner molds for thin-wall disposables, medical, housewares and other markets. The firm expects sales this year will exceed US$24 million, up from US$21.3 million last year. On some jobs it works closely with Husky Injection Molding Systems Ltd. of Bolton, Ontario.
Fairway, based in Los Angeles, focuses on multicavity high-precision molds for high-volume consumer products such as safety razor parts and complex technical and medical components. It predicts 1998 sales of $15 million, up from $12.5 million in 1997.
Under StackTech the two firms will operate autonomously but will share technology, marketing and financial activities, explained David Brown, newly appointed president of StackTech and president of Tradesco. StackTech also plans more niche mold maker acquisitions.
Castle Harlan Partners II LP owns 80 percent of StackTech and 34 employees and managers of Tradesco and Fairway hold the rest. Thomas Smith, former lead foreman at Fairway, is now its president. Former Fairway President and co-owner Edward McKeown will retire. Fairway's other owner, James Hagin, will act as consultant. McKeown and Hagin founded Fairway in 1977.
Castle Harlan acquired 80 percent of Tradesco in 1996 when two former part-owners left the company. Tradesco's management owns 20 percent of the firm, which was established in 1976.
Castle Harlan Partners II is one of several investment funds exceeding $1 billion formed by Castle Harlan to represent pension funds, college endowments, foundations and individual investors.