STOCKHOLM, SWEDEN (June 26, 11:20 a.m. ET) — Rosti AB, which has injection molding plants in China, India, the Netherlands, Poland and Scotland, is expanding in the United Kingdom by purchasing McKechnie Engineered Plastics Ltd.
Rosti is owned by Nordstjernan AB, a Stockholm-based investment company. The purchase price is 30.7 million pounds ($47.9 million).
Both companies previously had U.S. plants, but none are included in this deal.
McKechnie, which had been owned by London-based turnaround specialist Melrose plc, operates 110 injection molding machines at plants in Stamford Bridge and Pickering, England, as well as a metal fasteners operation in Swansea, Wales.
McKechnie has annual sales of about 75 million pounds sterling ($117 million) and employs 650. It makes automotive and packaging products, including the flow widgets that go into cans of Guinness and Heineken.
The company will be integrated with Rosti Europe, a division of Stockholm-based Rosti AB. McKechnie currently supplies most of Rosti's existing markets and the strategic fit between the two businesses was described by Rosti CEO B"rje Vernet as “impressive.”
Rosti Europe Chief Operating Officer Barry Coughlan agreed, and said the deal would open up a number of global markets to what had previously been a UK-centric business.
“McKechnie's customers are delighted to be working with a global company and there is tremendous scope to capitalize on that aspect going forward. This is a major step forward [for McKechnie] and we are delighted to be working with what is a very strong, very technically-minded team of people,” he said.
Coughlan said Rosti had been on the lookout for companies to buy for some time and had been in talks with McKechnie since the beginning of this year.
He said no closures or layoffs are planned, and he described the acquisition as an “expansion opportunity, not a rationalization exercise.”
“McKechnie has an outstanding reputation with a complementary portfolio of products, services, customers and markets.
“We are extremely positive about the synergy between our businesses. Combining our resources will provide a platform for both UK and international growth with many of our global OEM partners,” he added.
Coughlan said there were no plans to change McKechnie's “fantastic” management team, which comprises Brian Mann, managing director, and Mike Murphy, sales director.
Melrose Chairman Christopher Miller said McKechnie had “performed well as part of the Melrose group and we wish the management team every success.”
Both Rosti and McKechnie used to have operations in the United States.
Spell Capital Partners LLC bought McKechnie's plant in Minneapolis in 2001 and renamed it Midwest Plastic Components. That company is now part of Spectrum Plastics Group.
When Sweden's Rosti A/S sold its injection molding business to Nordstjernan in 2010, the deal did not include the company's three plants in the United States. Rosti A/S sold those plants in May 2010 to McCalmont Industries LLC, a management buyout group that included Jim McCalmont.
The U.S. Rosti business was renamed Premier Technical Plastics, which now is based in Irving, Texas, and also has a plant in