Two Somerville, N.J.-based plastics processors with common roots have combined to form Polycel Structural Foam Inc.
The Dec. 4 deal combines Polycel Corp., which has 90 employees at one plant, and Structural Foam Plastics Inc., with a total of 330 at three locations. Terms were not disclosed.
``We hope to broaden the customer base,'' and there is ``the possibility of additional acquisitions in the longer term,'' John Kurtz said in a telephone interview from Somerville. Kurtz is chief operating officer and general manager of the combined firms. He had been Polycel Corp.'s senior vice president and COO.
``It seemed to me like a good idea to merge and make a larger company,'' Stanley Rosania said in a telephone interview from a plant site in Winchester, Ky.
Rosania was a founder of Structural Foam Plastics in 1967 and continues in the business as the new company's executive vice president and a member of the parent holding company's board of directors.
Outside investors brought the companies together in two steps over 18 months.
In July 1997, Michael Mathews, principal of Westgate Capital in New York; Tom Phillips, principal of King Street Capital in Harrisburg, Pa.; and others including Kurtz acquired Polycel Corp. from principal owner John Marshal and minority holder James Bowen.
Marshal previously worked at Structural Foam Plastics; he left to form Polycel in 1972.
Now the investment group of about 10 includes Rosania. His two sons with Structural Foam Plastics' experience continue with the business, Jeff as vice president of design engineering and Carl as vice president of sales.
Kurtz said the firm will have consolidated sales of more than $40 million in 1998.
Significant declines in raw material pricing have lowered both firms' sales recently. Plastics News reported that Structural Foam Plastics had fiscal-1997 sales of $36.4 million and Polycel Corp., 1997 sales of $10.4 million.
Structural Foam's contributions include three plants. A 90,000-square-foot Branchburg, N.J., site employs 160 and operates five structural foam presses of 100-400 tons and seven injection molding machines of 145-750 tons. A 40,000-square-foot Liberty Center, Ohio, facility employs 50 and operates five structural foam presses of 180-450 tons. The 225,000-square-foot Kentucky plant employs 120 and has seven structural foam presses of 150-750 tons and seven standard presses of 250-1,740 tons.
Polycel Corp.'s contributions include its 60,000-square-foot facility and seven machines. Five vertical injection molding presses have clamping forces of 300-400 tons and shot sizes of 50-90 pounds for structural foam applications. Two horizontal units of 450 and 500 tons are used for structural work and some injection molding.
Both firms have broad markets with a minimal overlap of customers, Kurtz said.
Mathews serves as board chairman of Polycel Structural Foam Inc., and Phillips is president. Both have extensive experience in private company investments including some plastics operations, which they declined to identify.