BARABOO, WIS. (UPDATED Aug. 18, 6:15 p.m. ET) — Flambeau Inc. of Baraboo agreed Aug. 15 to acquire Mastercraft Cos. of Phoenix for its skills in mold making and producing precision plastic parts. Terms were not disclosed.
“Mastercraft brings something to us in areas we were not previously in,” said Jason Sauey, CEO of Flambeau and president of the holding company, Nordic Group of Cos. Ltd. “We will look to use Mastercraft as a platform to build on and transport its technology and knowledge to other locations within Flambeau.”
Mastercraft Cos., owned by founder Arle Rawlings, comprises two entities: injection molder Polycraft Industries Inc. and mold builder Mastercraft Mold Inc., which makes tools for internal and external projects and customers. Together, the businesses employ 110 including 13 mold makers, occupy two buildings with more than 58,000 square feet of space and had 2010 sales of about $12 million, Sauey said.
Polycraft operates 32 injection presses with clamping forces of 40-440 tons. It specializes in small-part, close-tolerance manufacturing.
Once the companies are integrated, Flambeau Phoenix will form the core of Flambeau's newly formed medical markets group and will connect with the existing Flambeau industrial markets group. The precision tool-design and tool-building operations will be known as Flambeau Technologies Center Phoenix. Flambeau's chief administrative officer, Todd Spencer, is the current operations manager in Phoenix.
Flambeau will bring Rawlings “into our business to fit his life interests,” Sauey said in a telephone interview from his Middlefield, Ohio, office. “He is a very capable guy with knowledge of tool building and plastics processing. We are looking to add Arle to our board of directors. If he wants to be busy, he will head up our tooling group and integrate tooling operations.”
Flambeau already makes molds in Baraboo and Weldon, N.C.
In the spring of 2010, Flambeau engaged investment banking firm Merkel & Associates Inc. of Beachwood, Ohio, as a buy-side analyst to identify potential acquisitions. As a result, “We saw some good alternatives, but the others were not as interesting as Mastercraft,” Sauey said.
According to Sauey, Rawlings, 70, sees Flambeau as a good fit for his business. In crafting an exit strategy, Rawlings “wanted to feel confident he was passing the business to people who would be respectful of [and] caring for the people.” The agreement was reached between principals without the use of an outside adviser.
Rawlings started initially as a toolmaker in December 1968 with two employees in two leased rooms.
In recent years, utilizing a Class 7 clean room, Mastercraft increased its emphasis on medical-device and medical disposable products, which accounted for about 70 percent of 2010 sales. Mastercraft also supplies the industrial, pool and spa, defense, electronics and aerospace markets.
“We think Mastercraft gives us new markets and new applications and new customers and some new skills,” Sauey said. “We look to learn from Mastercraft.”
Before this deal, Flambeau's most recent acquisition of a full business came in 1999, when Nordic Group purchased Blowspeed Ltd. of Ramsgate, England.
Flambeau is the major component of the Sauey family-owned Nordic Group of Baraboo.
Without including the Mastercraft acquisition, Flambeau employs about 2,000, including 24 mold makers. It had total 2010 injection molding and blow molding sales exceeding $200 million, divided almost equally between the processes, and operated nine facilities.
Flambeau has two manufacturing locations in Baraboo and one each in Middlefield; Weldon; Ramsgate; Columbus, Ind.; Madison, Ga.; Redlands, Calif.; and Saltillo, Mexico.
The company has more than 140 injection presses, with clamping forces of 24-1,500 tons. Its blow molding operations have more than 110 machines, with shot sizes of 1-75 pounds.
In addition to the new medical market group, Flambeau has automotive, industrial and retail market groups.
Nordic Group employs more than 2,600. William Sauey co-founded the business with his brother in 1947 and remains Nordic Group chairman.