United Kingdom-based Avon Rubber plc is selling its Milkrite InterPuls business to a subsidiary of packaging giant Tatra Group to focus on its defense industry products.
The sale of Milkrite InterPuls to DeLaval Holding BV for $226 million includes a wide range of products for commercial dairies, including tubes made with thermoplastic elastomer, connection system produced with polyphenylsulfone (PPSU), silicone and rubber materials.
The deal is expected to be completed in the first quarter of the firm's 2021 financial year, Avon Rubber said in a news release.
The business, which supplies "milking point solutions" to dairy farmers worldwide, has been growing and profitable over many years, according to Avon Rubber.
For the fiscal year ended Sept. 30, Milkrite InterPuls generated sales of $57.6 million and profit of $4.29 million.
The business includes production in Avon's headquarters location of Melksham, England, as well as Johnson Creek, Wis., and Modesto, Calif., in the U.S. and sites in Italy, Brazil and China.
Managing Director Craig Sage and Finance Director Andrew Porter will transfer to DeLaval, along with all of the other employees.
The Milkrite InterPuls unit has been an important part of the group for many years, according to Avon Rubber CEO Paul McDonald.
"However, having achieved our valuation expectations, the board believes the time is right to allow this business to grow and flourish under new ownership," McDonald said.
With around 4,500 employees and part of Tetra Laval Group, Stockholm-based DeLaval is a worldwide supplier of milking equipment.
In a statement, Joakim Rosengren, DeLaval president and CEO, described Milkrite InterPuls as "a very successful company with a strong brand and trademark portfolio acknowledged by dairy farmers across the world."
The acquired business, Rosengren said, will operate as a standalone company within the DeLaval organization.
After the sale, Avon Rubber will focus on its Avon Protection business, a global supplier of respiratory and ballistic protection in military and first responder markets.
Those products include both rubber and plastic systems for protective vests, gas masks and helmets.
McDonald said proceeds from the sale of the Milkrite InterPuls business will "provide further funding capacity, enabling us to take advantage of acquisition opportunities ... and enhance our capabilities within our target markets."