KBC Private Equity of Brussels, Belgium, has acquired a 35 percent stake in Afa Polytek BV of Helmond, the Netherlands.
Afa is an engineering and manufacturing firm specializing in liquid-dispensing systems, particularly trigger sprayers.
The company during the past six years has been growing fast, following a successful transformation from a commodity trigger sprayer manufacturer to a maker of highly engineered products.
Afa injection molds most of its components at its plants in Helmond, where it employs 140 in a 130,000-square-foot facility, and in Cixi, China, where Afa has two 100,000-square-foot plants and employs about 600.
The company continues to shift manufacturing to China, but has no plans to close down its main production facility in Helmond.
Afa Managing Director Ariel Gratch said the company is likely to open a plant in North America as it continues to penetrate the U.S. market with its products. Less than 5 percent of Afa's business currently is generated in the United States, Gratch said in a June 30 telephone interview.
The company produces high-tech packaging for multinational beverage and food companies.
``These guys have, for years, used packages that have become a commodity, to sell their brand based on brand strength and advertising,'' he said. ``Because of the private-label phenomenon that exists in the U.S., and is now solidly in Europe, most of these brands are seeing very big pressure on the shelf.
``If you go to Wal-Mart and look on the shelves, every package looks exactly the same, and that means you have to spend more money on advertising,'' Gratch said.
The way for major brands to differentiate themselves from low-cost, private-label competitors is to launch unique, innovative packaging, he said.
``The big brands are looking for new packaging - a way to dispense their product and differentiate themselves.''
The injection of funds from KBC's investment will help give Afa a boost, said Eric Roth, a New York-based vice president of investment firm Goldsmith Agio Helms in Minneapolis.
``This deal brings an infusion of capital to continue developing this technology,'' Roth said.
Among the new products that have Afa and investors excited about the future is a contract with Heineken to supply components for the beer maker's new 4-liter home keg system recently launched in Europe and poised for a U.S. rollout.
``Obviously, this is not something that other companies do,'' Roth said. ``We think the magic of this company is that it's not a straight engineering company, or a straight manufacturing company, but a hybrid of both.''
Gratch said Afa's product development skills will be on display during the next three years as the company continues to launch new products.
``In the next three years, we're hoping to double the size of the company,'' Gratch said.
Staff reporter Angie DeRosa contributed to this report.