Chicago private equity firm HC Private Investments has purchased Kruger Plastic Products, a custom injection molder and mold maker based in Bridgman, Mich.
The deal, for undisclosed terms, was announced Jan. 17. Kruger's senior management, including President Pat Brandstatter and Dirk Kruger, vice president of engineering, will maintain significant stakes in the company. Brandstatter declined to say the percentage they now own.
Dirk Kruger is the son of Dieter Kruger, who founded the company in 1975.
Kruger Plastic Products employs 100 and runs 47 injection molding machines, ranging in clamping force from 25-1,000 tons. The company makes molds and does engineering, decorating and assembly. Brandstatter said 2017 sales were $12 million.
The company, located in southwest Michigan close to the Indiana line, runs two molding plants — the 30,000-square-foot headquarters operation in Bridgman and a 60,000-foot factory in Galien — and 50,000 square feet of warehouse space in Buchanan.
"The reason we decided to move forward with HC was because of the value added they were going to bring to the business, both in terms of their expertise, and the capital they could bring to help us develop new systems and grow our business," Brandstatter said. Examples include MRP manufacturing systems and accounting systems, he said.
In a news release announcing the deal, officials of HC Private Investments identified several areas to accelerate Kruger Plastic's sales growth through strategic investments in manufacturing and personnel to serve existing customers, as well as expand into new markets such as medical.
Kruger lists health care as a market on its website. The company does "a little bit of stuff on the fringes" Brandstatter said. "But clearly one of the things that we are trying to move forward with is upgrading our level of quality so that we can move into that area."
Kruger Plastic has a diverse range of markets, including recreational vehicles, homecare, furniture, electronics, hardware, automotive, art and hobby and communications.
The acquisition of Kruger Plastic marks the first deal for HC Private Investments, according to a spokesman. HCPI was launched in mid-2017 as the private equity arm of HC Technologies LLC, a Chicago-based principal trading firm that specializes in foreign exchange and futures markets. HCPI invests capital from HC Technologies.
HCPI was founded as an alternative to traditional model of private equity ownership, as the firm has a "highly patient and flexible capital base and long-term investment horizon," according to a news release announcing its creation.
HCPI focuses on U.S. lower middle market manufacturing companies in the consumer and industrial markets. Typical investments are in the range of $5 million to $30 million. HCPI plans to retain in existing management, and supplement them with the firm's access to other industry executives.
