Extrusion machinery maker Processing Technologies LLC is on the hunt to buy another equipment supplier, partnering with private equity firm Crystal Ridge Partners, which bought a majority stake in PTi in 2005.
PTi's president and chief executive officer, Dana Hanson, said he expected a deal to be announced in the second quarter. ``The best acquisition candidates possess an existing product mix that falls somewhere downstream from the sheet extrusion process,'' he said.
Sheet lines will continue to be PTi's main business. But Hanson said the company in Aurora, Ill., is looking to add primary or auxiliary equipment that serves the same customer base as PTi.
PTi makes extrusion systems for a range of applications, including single-layer and coextruded sheet, film, foam sheet, compounding, reclaim and pipe and profiles.
Hanson and Jon Roberts, vice president of manufacturing, still own 35 percent of the firm, and the co-founders continue to run day-to-day operations.
Hanson and Roberts were the sole owners until they sold 65 percent to Crystal Ridge of Princeton, N.J. PTi never publicly announced the sale until Hanson issued a March 26 news release saying the firm was looking to buy complementary companies.
Hanson said the main motivation to sell part of the company was to get money to make acquisitions.
``The focus of the equity partnership is to complement the growth strategy that made the company successful, with strategic acquisitions and international expansion,'' Hanson said.
Although the investment by Crystal Ridge was done quietly, it follows the recent trend of private equity firms buying into plastics machinery manufacturing. Crystal Ridge was founded three years ago by Jack Baron and Don Hofmann, both formerly of J.P. Morgan Partners LLC.
With $70 million of capital, Crystal Ridge targets investments in middle-market companies, with sales of $10 million to $75 million, that are growing and have strong management.
Crystal Ridge's equity investments typically range between $3 million and $10 million per transaction. Crystal Ridge and PTi have not released details of their deal.
PTi is the first plastics machinery company investment for Crystal Ridge. The equity firm does have one other holding in the plastics industry - A.R.E. Accessories LLC, a Massillon, Ohio, maker of fiber-reinforced-composite and aluminum truck caps and tonneau covers.
