November 6, 2015 Updated 11/6/2015
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Milacron LLC is spending $ 22.5 million to buy CanGen Holdings Inc., the umbrella firm that owns screw and barrel maker Canterbury Engineering and Genca, a maker of crosshead dies used for extruding tubing and insulated wire.
Milacron announced the acquisition Nov. 6, as it released its third-quarter financial results. Milacron went public on the New York Stock Exchange on June 25.
Milacron already makes screws and barrels at its Wear Technology plant in McPherson, Kan., and at the company’s main machining factory in Mount Orab, Ohio.
CanGen has annual sales of about $ 20 million. Canterbury’s plant is in Atlanta. Genca is in St. Petersburg, Fla. Milacron said those two plants will remain in operation — and give Milacron regional centers for parts and service in the southeastern United States. Genca also has a strong position in Mexico and South America, Milacron officials said.
Milacron said the deal also enhances the company’s aftermarket capabilities, including a broader offering into downstream tooling, proprietary rights to more than 185,000 unique designs and drawings.
“CanGen fits perfectly with our core growth strategy of accelerating lifecycle sales through consumable products and aftermarket service,” said Milacron CEO Tom Goeke. CanGen also gives Milacron an entry into the extrusion market for rubber products, he said.
CanGen chief executive Paul Cusolito said that the deal “offers a great opportunity for CanGen and its employees to serve a significantly larger customer base while obtaining access to the extensive resources available at Milacron.”
The transaction is expected to complete by the end of the year.
Through the first nine months of 2015, Milacron reported sales of $ 873.2 million, down 2 percent from the first nine months of 2014. The company had a net loss of $ 54.3 million through the first nine months, but said its adjusted net income was $ 64.7 million in the black.
Adjusted net income is a measurement that removes some non-recurring items such as amortization expenses, costs for debt and acquisitions, and shareholder fees.
The company reported operating profit of $ 38 million for the first nine months, down from $ 60.9 million in the year-earlier period.
