ROCHESTER HILLS, MICH. — Fresh from buying three small injection molding companies, InMold Corp. is starting a campaign to raise public equity for more growth.
The public company, based in Troy, Mich., has been a quiet player on the larger automotive stage since its formation in January 1997.
Discreetly, the holding company purchased two financially struggling molders, GP Plastics Inc. of Rochester Hills and AEP Technologies Inc. of Fraser, Mich., in September 1997.
In August 1998, Rochester Hills molder Seville Plastics Inc., located across the street from GP Plastics, was added to the acquisitions list.
Now, the company is planning its coming-out party. This month, InMold will begin meeting with a series of investment bankers to shop its stock to Wall Street more aggressively, said InMold President and Chief Executive Officer Filipp Kreissl.
The purpose is to light a fuse that will stimulate over-the-counter trading on the Nasdaq Bulletin Board, Kreissl said. Within six months, that could raise InMold's stock price to equal the company's market value, he said.
Until now, trading has been inactive, and InMold's stock price virtually nonexistent, he said.
``We're ready to show our faces publicly,'' Kreissl said. ``We want to raise the equity to support our growth. We're busting at the seams with capacity needs right now.''
A large part of InMold's explosive growth is coming from a product traditionally stamped from magnesium: a first-ever, plastic steering-column support bracket that provides structural backing for the instrument panel. The work includes a complex, automated process to insert eight metal nuts into each bracket.
The bracket, which first was conceived by AEP, uses nylon 6/6 resin. The part — saving about 30 percent in cost and 10 percent in weight — was picked up by DaimlerChrysler for its entire 1999-model minivan line, including the Dodge Caravan, Plymouth Voyager and Chrysler Town & Country.
That part, and other structural pieces converted to plastic, attracted Kreissl and other investors to the companies. Kreissl, who has owned other auto suppliers, is president of Sanders Confectionery Products Inc., a former Detroit-based maker of candies that now is a holding company for other businesses.
In 1996, he convinced the firm's 3,000 investors to trade stock for shares in the new injection molding business.
He then hired Joseph Schmidt, a manufacturers' representative and Hall of Fame football player with the Detroit Lions, as InMold chairman. David Shifflett, former president of GP Plastics, became InMold vice president.
Schmidt, who had worked with GP, said the molder was having difficulty with an inefficient paint line and lack of resources.
``We weren't doing as well as we could, and a change was needed,'' he said. After the sale to InMold, the paint line was dropped.
Moreover, AEP was struggling to get the innovative steering column bracket out of the gate. It still is a challenge, said Rick Adams, InMold's DaimlerChrysler business unit manager.
``Particularly with safety items, automakers are a bit apprehensive to use plastic,'' Adams said. ``We had to prove its durability with a number of tests.''
Now, the company is on the verge of more dramatic growth with the product. InMold has contracts totally about $28 million that will begin kicking off within 18 months, said John Horner, company treasurer. Those contracts currently are with DaimlerChrysler and General Motors.
That and other projects could push sales volumes from about $16 million in 1999 to close to $50 million by 2002, he said.
With that comes the capacity needs. The company would like to add six to seven new presses with clamping forces as high as 1,500 tons by the end of the year 2000, Kreissl said. But equipment alone could cost more than $10 million.
The company also would like to buy an existing plant to add the presses. Currently, InMold operates 36 presses from 75-1,000 tons of clamping force at the three plants.
It is difficult to determine the market reception that InMold will receive from Wall Street, said David Eberly, director of GMA Capital LLC, a financial adviser to InMold based in Farmington Hills, Mich.
``It likely won't attract the attention of major traders, but the company has some high-profile products,'' Eberly said. ``The nice thing about public equity is that it brings another form of currency. They'll need that to increase capacity over the next several years.''
