MARLBOROUGH, MASS. (Dec. 14, 4:30 p.m. ET) — In less than three years, privately owned Vention Medical has transformed itself from a midsized medical-device contract manufacturer into one of the industry's largest.
“I would think that we are one of the top three companies in both size and capabilities,” said Chairman George Blank in a phone interview earlier this month.
Blank cited the company's November acquisition of Atek Medical Group, which has manufacturing plants with a total of 365,000 square feet.
Atek Medical Group, based in Grand Rapids, Mich., was part of Atek Cos., based in Plymouth, Minn., before its purchase by Vention. Atek Medical Group includes both Atek Medical and Atek Plastics, which has a plant in Kerrville, Texas.
Blank declined to discuss the size of the company in revenue, but said that in addition to growth from four acquisitions in the past three years, Vention has been “growing nicely, well ahead of the industry average,” which is near 10 percent.
The Atek purchase — the second acquisition for the company in the past three months — also makes Vention “the largest medical contract manufacturer in Costa Rica.”
After Vention opens its new plant in Costa Rica later this year — a molding facility Atek was in the process of opening — the combined companies will have five plants in that country, with a total of more than 175,000 square feet of manufacturing space.
“All of the facilities are close to each other in the Metro Free Trade Zone in Heredia, Costa Rica,” Blank said. “One can walk between them in three to four minutes. We know each other well and have been good neighbors [and] friendly competitors for some time.
“The combined companies will have significantly more clean room space to bring projects to Costa Rica,” he said, as the two Atek plants have a combined 115,000 square feet of space.
Vention has additional offshore plants in Vega Baja, Puerto Rico, plus a European presence with a plant in Ireland that was included in the August acquisition of Boyle, Ireland-based Ansamed Ltd., an advanced extruder and catheter manufacturer.
In the U.S., the combined companies will now have Atek Plastics' 67,000-square-foot plant in Kerrville, existing Vention plants in South Plainfield, N.J.; Salem, N.H.; and West Haven, Conn., and the two Atek Medical plants in Grand Rapids — the original, 100,000-square-foot plant and a newly opened, 85,000-square-foot plant designed as a center for “packaging excellence.”
Vention also has design and development facilities in Sunnyvale, Calif.; Boulder, Colo.; and Marlborough, Mass., where the company is now headquartered after previously having its corporate offices in South Plainfield.
All of the Vention plants have full-scale clean room manufacturing, and Sunnyvale and Marlborough have smaller clean rooms for pilot manufacturing.
“The Atek acquisition gives us new locations where we didn't have a geographic presence,” said Blank, adding that he plans to continue searching for companies to add to the Vention portfolio. “We are very aggressive in the market, looking for specific capabilities that we think will be helpful to our customers. Our team plans to grow our business with existing and new customers and make more acquisitions.”
The recent buying spree already has given Vention's capacity a significant boost. It has also nearly tripled the workforce at Vention — which was known as Medtech Group Inc. until earlier this year — from 500 to almost 1,400, with a majority of those workers in the U.S.
Among important aspects of the Atek deal are “the synergies between the two companies, and the capabilities the Atek acquisition brings to the Vention family of companies,” Blank said.
The purchase gives Vention additional manufacturing and assembly capabilities, as well as a broader group of customers in medical intervention areas such as cardiology, neurology, vascular products, spine care, wound care and stem-cell therapy, he said.
“Atek has significant capabilities in medical-device manufacturing and injection molding,” Blank said. “They make extensive use of robotics and other automation” in both manufacturing and packaging.
“They have [a number of] assembly technologies which fit nicely with what Vention does,” said Blank, “including electro-mechanical assembly, laser marking, metalworking, metal annealing and mandrill dripping.”
The acquisition also will enable Vention to make its manufacturing operations more efficient.
“Atek has a very good manufacturing optimization process to drive out costs,” he said. “We like their approach, and we plan to implement the best practices [they have] into all of our plants, [as] the whole industry is now very focused on cost control.”
Conversely, Vention will use its design and development capabilities to help Atek grow.
“We have over 100 engineers dedicated to design and development [and] the capital resources that will help grow the business,” he said. “The synergies go both ways.”
To manage the acquisitions that have been made in the last three years, Vention has bolstered its management team.
In January, Dan Croteau — former president of the global medical products contract design and manufacturing division of Flextronics International Ltd. — was hired as CEO. Vention also brought in Thomas Testa as chief financial officer and named Atek President Chris Oleksy president of the company's medical molding assembly sector.
In addition, Vention added Atek Cos. President Kay Phillips to its board of directors. Phillips helped launch Atek Medical, which was formed from the assets of Medtronic Inc.'s cardiac surgery unit in 2003.
Vention manufactures precision injection molded medical parts, complex medical devices and advanced medical components such as heat-shrink tubing, catheter balloons and complex extrusions for intervention applications and minimally invasive surgery.
Its transformation stems from the string of acquisitions that began in December 2008 when Vention acquired Marlborough, Mass.-based TDC Medical Inc., a design and development firm known for its single-use, hand-held instruments and intervention devices used in therapeutic and surgical markets.
In July, 2010, Vention merged with medical heat-shrink tubing and catheter balloon developer and manufacturer Advanced Polymers Inc., based in Salem, N.H. — which gave the company its entree into catheter-based intervention markets.
Atek Medical Group makes medical devices for cardiovascular, cardiac-care, orthopedic, neurological markets and spinal surgeries, as well as Class III implantable devices and medical equipment.
According to the company's website, Atek annually makes more than 6 million finished-goods units and more than 150 million medical plastics components, and has launched over 400 medical devices at its Grand Rapids location in more than three decades.