Transcendia Corp. is acquiring Precision Poly LLC, which operates a polyethylene film plant in Grand Rapids, Mich.
The new owners see opportunities to expand operations, leverage technology and create inroads into new markets on both sides of the deal.
"I think the rationale for us is it further strengthens our position to grow in a targeted food and beverage segment," Transcendia Corp. CEO Andy Brewer said in an interview.
Precision Poly makes food grade coextruded film, bags and rolls for flexible packaging.
And that company's certification from the Safe Quality Food Institute for the Grand Rapids facility is viewed by Transcendia as a way to boost its standing in that segment.
"It's become the gold standard for insuring food safety," Brewer said. "You get instant credibility. That's where it's important for us in a growing segment."
The transaction also expands the Franklin Park, Ill.-based company on the equipment side.
"It also gives us multilayer blown film capabilities that we believe will further support our growth into the anticorrosion market here in North America. Those are the two primary drivers for us," Brewer said.
The company's 2014 purchase of MetPro Group in Europe, the CEO explained, included the acquisition of anticorrosion masterbatch technology called Vapor Corrosion Inhibitor. With the ability to now make multilayer structures in North America, Transcendia said that opens up production of anticorrosion packaging in the United States.
"it allows us to put that into our own film and now be more aggressive and assertive in our entry into the North American marketplace. We hold the leadership position in Europe and we're well-positioned in China. This was to help facilitate that growth in the North American anticorrosion marketplace," Brewer said.
"It's predominately automotive focused, but also into the steel industry as well," he said.
With the automotive industry shipping parts around the world to final assembly plants, it is important to protect against corrosion through specialized packaging, he explained.
"We view this as a platform for ourselves to potentially continue the expansion into more of a national footprint for us," Brewer said.
Trancendia acquired Precision Poly after the company put itself up for sale. Precision Poly becomes the sixth acquisition by Transcendia in the past five years. Transcendia secured the firm by acquiring its parent company, Spire Flexpack Inc.
"Each company's attractive portfolio of food and industrial products are highly complementary," Precision Poly President Parnell Olson said in a statement. "We are well positioned for growth with the addition of Transcendia's national infrastructure, diverse film manufacturing and converting capabilities and resources to expand our business."
