Nomacorc LLC, a maker of more than a billion synthetic wine closures a year, is gaining financial muscle with a private equity firm providing new funds to continue its expansion.
Nomacorc parent Noel Group LLC and private equity group Summit Partners of Boston announced June 21 that Summit is taking an undisclosed equity stake in the wine closure business.
``We are attracted to the Nomacorc opportunity because of the company's market leadership position, quality management team and outstanding growth prospects,'' said Kevin Mohan, a general partner in Summit Partners' Boston office.
Noel Group's Marc Noel remains chairman of Nomacorc's board, which will be expanded to include Mohan and Summit Partners Vice President Jason Glass.
``We've been growing very fast since 1999 and this will improve our opportunities to grow even more,'' said Nomacorc President and Chief Executive Officer Lars von Kantzow. ``A big driver has been the desire from the wine industry for a better closure solution,'' von Kantzow said in a telephone interview.
Von Kantzow said the traditional cork can fail to preserve a good wine under certain circumstances. That was the idea that started Belgian businessman Gert Noel to look for a replacement in the 1950s. His son, Marc Noel, launched Nomacorc in 1999 to serve wine professionals in California. The Zebulon, N.C.-based firm coextrudes a polyethylene foam core with a plastic-based skin. The closure, which is covered by a number of patents, is used on wines including Kendall-Jackson's Chardonnay and Robert Mondavi's Woodbridge, von Kantzow said.
``We have a sophisticated closure system that tightly controls the oxygen getting into the wine and wine is very sensitive to oxygen,'' he said.
In May, Nomacorc boosted extrusion capability and added high-speed printers at its Zebulon plant. It also added extrusion at its Raeren, Belgium, site. The firm employs a total of 400.
Von Kantzow said Nomacorc has about one-third of the U.S. wine market, and by boosting capabilities, it can seek opportunities in Asia, South America, South Africa and Australia. Synthetic ``corks'' account for 20 percent of all wine closures, van Kantzow said. He expects that to grow to 35 percent by 2010. Nomacorc's share also is growing, he said.
Noel is a private holding company in Wake Forest, N.C. Its companies specialize in transforming engineered synthetic materials. Summit Partners has raised more than $9 billion to provide financing to about 290 firms.