IMI plc, a British plastics pipe manufacturer, is expanding its soft drink dispensing equipment business with the acquisition of plastics-based, point-of-purchase display producer Display Technologies Inc. of College Point, N.Y.
IMI, based in Birmingham, England, already owns Cannon Equipment Co. of Rosemount, Minn.
Display Technologies has a reputation for creating innovative plastic displays, according to IMI. Customers include consumer product companies in the beverage, cosmetics and food industries.
Last year, Display Technologies reported a profit of $6 million on annual sales of $56 million.
Under the arrangement, announced June 1, IMI agreed to pay $37 million to purchase 80 percent of Display Technologies' shares.
Richard Jay, president of Display Technologies, plans to retain a minority stake, and he will continue to play a leading role in the development of the combined businesses, according to IMI.
The global point-of-purchase market generates sales of about $24 billion annually.
That market is growing about 5 percent per year, according to IMI Chief Executive Officer Martin Lamb.
``Consolidation amongst the customer base, particularly in the U.S. retail sector, is driving rationalization on the supply side, which is currently highly fragmented,'' Lamb said.
``IMI is well-placed to lead this supply-side consolidation in what is a high-growth, innovative and high-added-value business.''
The combined operations, with complementary product and market positions, are expected to have total sales of more than $160 million.
Cannon Equipment Co. has three operating subsidiaries: Cannon Equipment Midwest Inc., based in Cannon Falls, Minn.; Cannon Equipment Southeast Inc., based in Chattanooga, Tenn.; and Cannon Equipment West Inc., headquartered in Garden Grove, Calif.
IMI also acquired Melrose Display Inc., headquartered in Passaic, N.J., in January 1999.