North Branch, Minn.-based Frandsen Corp. acquired the assets of Lakeland Tool & Engineering Inc. and will run it as a subsidiary and sister company to Plastech Corp.
Lakeland is based in Anoka, Minn., and has a second facility in Wisconsin. Plastech Corp. is in Rush City, Minn.
The deal between the two privately held companies brings together Lakeland, an injection molder since 1973 with sales of about $22 million, and Plastech, an injection molder since 1963 with sales of about $54 million, David Brentz, Frandsen's vice president of sales, said in a phone interview.
The two molding operations are located about an hour apart and both serve the appliances and outdoor power markets but with little overlap in customers and no overlap in terms of the radius for employee hiring, Brentz said.
“The big synergy between the two is that they are 58 miles apart. That doesn't sound like a lot but it means we're essentially drawing from different labor pools,” Brentz said. “That's significant with the unemployment rate being where it is and with the competition for everything from entry-level labor to operators.”
All 120 full-time Lakeland employees were rehired April 1, including office staff and management.
“The economy is doing well and entry-level labor is a challenge,” Brentz said. “Being able to acquire a company with experienced operators and a defined customer base was big deal to us.”
The two molders share only four clients, accounting for less than 5 percent of Lakeland's total sales, according to Brentz.
“We see the two companies as very complementary rather than competitive,” he said.
Lakeland also produces parts for the consumer goods, electronics, industrial, and institutional furnishings markets at its 187,000-square-foot factory in Anoka and a 50,000-square-foot facility in Frederic, Wis. The company's website says it has 59 injection molding machines and 14 thermoset compression molding machines with auxiliary equipment.
Plastech also supplies components parts and assemblies to the automotive, agricultural, construction, recreational equipment and transportation markets with a 44-press fleet at a 350,000-square-foot plant in Rush City. In addition, the company offers technical services for product design, assembly, warehousing and surge capacity to support drop-in orders.
With sales of $65 million, Plastech ranks 105th among North American injection molders, while Lakeland ranks 216th with sales of $24 million, according to Plastics News' latest ranking.
The acquisition was announced April 1, which marked the 46th anniversary to the day that Lakeland was founded by Don Gross and Marty Sweerin. Terms of the deal weren't disclosed.
Frandsen plans to continue operating the acquired company as Lakeland Tool & Engineering. The 120 employees operate presses ranging from 45 to 1,430 tons , build molds in-house, and, in Wisconsin, offers thermoset compression molding from 150 to 300 tons to customers in the oil-and-gas-gathering industry and other markets.
“We're looking forward to learning more about the application,” Brentz said, noting that compression molding produces high-density parts that can take on the characteristics of metals.
Derek Gross, son of founder Don Gross, will stay on at Lakeland, keeping his role as operations manager.
Frandsen Corp. and related entities are a family of businesses owned and operated by founder and CEO Dennis Frandsen, his son, Greg Frandsen, who is president, and Dan Ferrise, who is chief operating officer. In addition to the manufacturing sector, Frandsen operates in the banking sector from facilities in Minnesota, North Dakota and Wisconsin.