Madison Capital Partners, a Chicago investment group that owns several plastics processors and other equipment companies, is paying $62 million for five of John Brown Plastics Machinery's six units.
Madison says it plans to keep and run the businesses, and acquire more plastics equipment firms in the near future.
John Brown's parent, Kvaerner ASA, a Norwegian engineering and ship-building conglomerate, announced the sale Nov. 30.
The deal includes five businesses: Brown Machine, a major manufacturer of thermoforming machinery in Beaverton, Mich.; Epco of Fremont, Ohio, which remanufactures plastics machinery; Cumberland Engineering of South Attleboro, Mass., a granulator supplier; Beringer, which makes pelletizers and screen changers in Marblehead, Mass.; and Leesona, which makes textile winders in Burlington, N.C.
Those companies generate total sales of about $100 million a year, said Larry Gies, managing director of Madison Capital.
Madison elected not to purchase the other John Brown business, injection molding press builder Negri Bossi SpA of Milan, Italy, Gies said.
He said his company plans to buy at least two more plastics equipment firms in the next two years to ``fill in the gaps'' of the Brown Machine family. Madison Capital plans to continue to run all five Brown companies in their existing locations, he said in a Dec. 1 telephone interview.
Gies said Charles Buckley will stay and run the plastics machinery operations.
Buckley, chief executive officer of South Attleboro-based John Brown Plastics Machinery, did not return telephone calls seeking comment.
Kvaerner, a $10 billion company, is under pressure to reduce debt. The company has pledged to sell $1.6 billion worth of noncore businesses. Kvaerner announced the Brown businesses were for sale in September, and the following month, at the K'98 show in Germany, Buckley told Plastics News that more than a dozen separate buyers were interested in buying.
Gies said the machinery units offer an attractive package.
``The areas that they're in are very nice niche markets, and they're very strong in each,'' he said.
Madison owns several other machinery companies. The largest ones are Holcroft, a Detroit company that makes heat-treating furnaces for automakers, and Pacific Press Technologies in Mount Carmel, Ill., which builds presses for metal stamping and compression molding of plastic composites.
In plastics machinery, Gies said, Madison Capital wants to focus on niche-market businesses and make auxiliary equipment. ``This is a business we intend to build,'' Gies said.
The company does not want to participate in the intensely competitive injection molding business — that's why it passed on Negri Bossi, he said.
Madison's subsidiary, Plastics Group, owns four processors: Pawnee Rotational Molding Co. of Maple Plain, Minn.; blow molders Borse Industries LP of Willowbrook, Ill., and Fremont Plastic Products Inc. of Fremont, Ohio; and blow molder and rotomolder Wedco Moulded Products of Boucherville, Quebec.
Madison Capital will run the John Brown plastics equipment businesses. Plastics Group will continue to focus on processors.