Barnes Group Inc. has a long history, but it's been investing in new growth for a business unit created just four years ago.
Barnes, which is traded on the New York Stock Exchange, announced July 12 that it was buying the Foboha business from Adval Tech Holding AG and adding the maker of rotating cube molds for thin-wall packaging, closures and other markets for $136 million.
The move is the latest acquisition for Bristol, Conn.-based Barnes, an industrial company that's building an international plastics technology group which now makes up more than a quarter of its business.
The acquisition should close in the third quarter. Barnes is buying the Foboha business from Switzerland's Adval Tech which has owned Foboha since 2003.
Foboha marks Barnes' entrance into the cube molds, which can be used to do multi-component or multi-color molding, and in-mold assembly. The molds rotate between separate injection units. The Foboha business specializes in complex molds for packaging, medical, consumer and automotive applications.
“We are excited to add Foboha's proprietary cube mold technology to our portfolio of advanced offerings in the plastic injection molding industry,” said Patrick Dempsey, president and CEO of Barnes Group, in a news release announcing the deal. “The addition of Foboha enhances our position as a leading global supplier of complex molding systems.”
Foboha will operate as part of Barnes' Molding Solutions unit of its Industrial segment, together with other plastics-related operations Barnes has purchased in the past four years that make hot runners, molds and in-mold sensing systems and process controls: Synventive, Otter Männer, Thermoplay and Priamus
The move into plastics processing technology kicked off in 2012, when Barnes purchased Synventive for $335 million. Creating the Molding Solutions group marked a diversification move for Barnes, which was founded in Bristol in 1857. The company does precision machining and fabrication of components for aerospace, industrial, automotive and health care markets.
During the company's first-quarter conference call in April — before the Foboha news — Dempsey said Molding Solutions generated 27 percent of Barnes Group's 2015 sales. He forecast sales growth of the mid-single digits this year for Molding Solutions in organic growth, not counting additional sales from the acquisitions last year of Thermoplay and Priamus.
Barnes reported 2015 companywide sales of $1.19 billion, down 5.4 percent from 2014. Net profit was $121.38 million, an increase of 2.5 percent.
The strong Swiss franc has hurt Adval Tech Holding's financial performance, and the company said it will use proceeds from selling the Foboha business primarily to reduce debt. Adval is focusing on growing its Components segment, which serves the automotive market. Earlier this year, Adval began production of a plant in Mexico.
Adval said Foboha employed 371 at the end of 2015, in Switzerland, Germany, China and the United States. Foboha's headquarters is in Haslach, Germany.
Barnes will pay Adval 133 million Swiss francs for Foboha, using cash and its revolving credit facility. Adval is based in Niederwangen, Switzerland.