Switzerland-based Maag Pump Systems AG has agreed to buy Gala Industries Inc., the U.S.-maker of underwater pelletizers, centrifugal pellet dryers and related equipment.
Maag announced the deal Oct. 20. Terms were not disclosed. Gala Industries, based in Eagle Rock, Va., also manufactures products in Xanten, Germany, and runs a sales office in Thailand.
Maag, headquartered in Oberglatt, Switzerland, is a global maker of gear pumps, pelletizing systems and filtration systems for plastics and other industries.
Both companies will retain their existing brand names, which include Maag Pump Systems, Automatik Pelletizing Systems and Gala Industries.
Maag President Ueli Thuerig will head the combined businesses.
Since 2003, Gala has been a 100-percent-employee owner company, through an Employee Stock Ownership Plan. Gala employs 194. ESOP members agreed to sell to Maag.
Thuerig said Maag has become a broad supplier for creating solutions for customers, as Maag and Gala will share strengths.
Gala CEO David Bryan said the two companies “fit perfectly together.”
“This is a unique opportunity to expand our suite of services, create enhanced professional opportunities and increase our geographic reach which will further enhance our profitability,” Bryan said in the announcement.
Maag is owned by Dover Corp., a publicly traded company based in Downers Grove, Ill.
In Dover's third-quarter conference call, held the same day as the Gala announcement, CEO Robert Livingston said the acquisition of Gala and a separate deal to buy Italy-based textile printing ink maker JK Group SpA, will have a combined purchase price of about $520 million. JK and Gala are expected to generate combined sales of about $165 million in 2016.
Livingston said Gala has an operating margin of about 12 percent. He said when Dover bought Maag in 2012, Maag had a similar margin, but the profit level has improved since then.
JK has an operating margin of about 45 percent, and company officials in the earnings call said JK has the strongest profits of any business that Dover has acquired.
Through the third quarter, Dover generated sales of $5.26 billion and reported profit of $728 million.
