Rotonics Manufacturing Inc. dramatically has boosted its custom rotational molding sales with its Feb. 26 acquisition of the rotational molding division of Plastics Group Inc.
Rotonics paid an undisclosed amount for the Willowbrook, Ill., rotomolding operation, the only one owned by Plastics Group. The purchase will launch Rotonics into new end markets such as defense, fluid management, commercial vehicles, cleaning equipment and industrial equipment, the companies said in a March 1 news release.
The acquired business reported 2005 sales of $24.1 million in Plastics News' rotational molders survey. Rotonics had sales of $48 million for the year ended June 30. The Willowbrook plant is its 10th rotomolding site. Rotonics' key markets have included commercial, agricultural, refuse, health care, marine and recreation.
Plastics Group sold the rotomolding business to concentrate on blow molding, according to Plastics Group Chief Executive Officer Brian Beth.
``The superior financial results of our rotational molding business gave us the opportunity to realize a strong return on our investment and the additional financial resources to take advantage of growth and consolidation opportunities in the blow molding industry,'' Beth said in a news release.
In a telephone interview, Beth said Plastics Group is expanding internally by adding blow molding equipment while it weighs its acquisition opportunities. Plastics Group's industrial blow molding sales in 2005 were about $91 million, derived from operations in Willowbrook and in Fremont, Ohio. It is owned by Chicago Growth Partners of Chicago.
Rotonics' rotomolding purchase was the second consolidation to occur among North America's biggest players in less than two months. Effective Jan. 2, Acrylon Plastics Inc. of Winnipeg, Manitoba, bought Norwesco Inc.'s Saskatoon, Saskatchewan, operation. In a bigger deal last spring, Icelandic firm Promens hf bought Elkhart Plastics Inc. of Middlebury, Ind., vaulting it to third place among rotomolders in North America with 2005 sales of about $88 million, according to PN's survey.
``The fragmented rotational molding industry is undergoing changes, as a result of a number of recent sales and acquisitions,'' said Bill Jarrett, lower midmarket group managing director for Goldsmith Agio Helms of Minneapolis, which assisted in the transaction. Goldsmith Agio also helped arrange the Promens/ Elkhart deal.
Rotonics' purchase of the Willowbrook operation followed on the heels of Rotonics going private late last year to eliminate the costs of being a public company. Rotonics President and CEO Sherman McKinniss acquired a minority stake in the firm while Spell Capital Partners LLC of Minneapolis became majority owner.
Rotonics and Plastics Group had signed a letter of intent for the Willowbrook rotomolding plant deal in early January.