When Bob Macintosh started to plan an exit strategy from Nicolet Plastics Inc. six years ago, he wanted to leave the company in the hands of a stable buyer.
The custom injection molder's location, in the Wisconsin North Woods, was a complicating factor.
“My end goal was to create stability for this plant and this area. This is a community of 700 people. If something happened that affected the jobs of the 82 people who work here, that would be devastating to this area,” Macintosh said.
After a long search, Macintosh thinks he found the right buyer. On Feb. 28 he signed a deal to sell Nicolet to True Venture Composites LLC, an affiliate of family-owned Badger Mining Corp. of Berlin, Wis.
Terms of the deal were not disclosed.
Badger Mining was looking to diversify outside its core business of mining and processing sand and other aggregates for industrial applications like hydraulic fracturing. It settled on plastics as an industry of interest, and contacted Macintosh about Nicolet.
Nicolet may be small, but it has a reputation in plastics and manufacturing circles. The company was twice a finalist for Plastics News Processor of the Year, and in 2013 it won a Frost & Sullivan Manufacturing Leadership 100 award.
Macintosh had talked to other potential buyers, including plastics processors and private equity investors. But he was having trouble finding the right fit. A key was protecting the workforce.
True Venture understood his priorities, so Macintosh expects very few changes. True Venture bought both the business and the plant, in tiny Lakewood, Wis., in the Chequamegon-Nicolet National Forest. All the employees and the management team are staying.
John Ogorek, the chief financial officer, is adding CEO to his title, but Macintosh said that transition started about a year ago.
The biggest changes: a new name, Nicolet Plastics LLC, and a new role for Macintosh. He'll be working with the new owners to find more investment opportunities in the plastics industry.
“Businesses either grow or die. We are definitely growing,” he said. “I'll be working with them the next two years, making sure this business grows and survives, and looking for other opportunities.”
Macintosh said Nicolet needs more molding capacity. But as he approaches age 70 he didn't want to go back into debt to make that happen. Plus, because of the scarcity of new workers in the North Woods, expanding at Nicolet would be difficult.
Now he's looking to buy companies with capacity to take on more work, and that have complementary values to Nicolet and Badger.
Nicolet has 82 employees and 19 presses, ranging from 40 to 610 tons of clamping force. It generated $14 million in sales last year, Macintosh said.
Nicolet is known for making the most of complexity — molding small lots, with numerous tool changes — using a philosophy called Quick Response Manufacturing, which they learned from Rajan Suri at the University of Wisconsin. The company specializes in low- to moderate-volume projects, and highly complex custom parts.
The company celebrated its 30th anniversary last year. Macintosh and three partners started the company in 1985 and incorporated in 1986. They started with an investment of $1,200 — $300 from each partner — molding in a small garage with a leased Newbury press.
Over time, Macintosh bought out the other three partners, the last one in 2008.