A. Schulman Inc. (Akron, OH) has expanded its presence in the North American masterbatch market, purchasing color concentrate manufacturer McCann Color Inc. (North Canton, OH) for less than $10 million in cash. In addition to specially formulated color concentrates, McCann Color supplies UV absorbers, dry color, flame retardant compounds, and toll compounding and blending. The company operates a 48,000-ft2 manufacturing facility in North Canton, which was built in 1998 exclusively to produce color concentrates. Now it joins A. Schulman's existing masterbatch manufacturing and product development sites in Akron and San Luis Potosi, Mexico.
In a release, Joseph M. Gingo, A. Schulman chairman, president, and CEO, said the acquisition supports his company's strategy to become a leading global manufacturer in masterbatch, to further profitable growth of its North American color operations, and to reduce its dependence on the automotive market. McCann's products see use in packaging, furniture, consumer products, appliances, and lawn and garden. The company's concentrates are applicable for extrusion (sheet, profile, film), blowmolding, compounding, rotational molding, and injection molding. Concentrates and colors are produced for acetals, nylons, polyethylene, polyester, polypropylene, styrenics, polyurethane, vinyl, elastomers, and thermoplastic rubbers.
Jennifer K. Beeman, A. Schulman’s director of corporate communications and investor relations, told PlasticsToday that McCann has approximately 24 employees and almost all will be retained, including managers at the color facility. The company’s Sharon Center has 53 employees total, 13 of whom were absorbed into other parts of A. Schulman.
As part of the move, A. Schulman also announced it would close its Polybatch Color Center in Sharon Center, OH and consolidate production into the newly acquired McCann facility. The consolidation and the acquisition integration are expected to be completed by the end of A. Schulman's fiscal year, Aug. 31, 2010. Including the acquisition and the Sharon Center closure, A. Schulman expects to show an annual operating income improvement of $2 million-$3 million, with full effect to be realized in fiscal 2011. According to its ISO 9001 certification, the Sharon Center site manufactured masterbatches, additives, engineering compounds, standard polymers, and thermoplastic elastomers.
In a Jan. 6 release of its fiscal 2010 first quarter earnings, which ended Nov. 30, 2009, A. Schulman reported that its North American businesses earned $2.9 million during the quarter, a $5.2 million turnaround from the previous year's first-quarter loss of $2.3 million. Volume was down 17.8% from the fiscal 2009 first quarter, reflecting the company's efforts to eliminate low-margin capacity. On Dec. 2, 2009, A. Schulman signed a definitive agreement to acquire all of the outstanding stock of ICO Inc., a global manufacturer of specialty resins and concentrates that also provides specialty polymer services, including size reduction and compounding. —[email protected]