Hillenbrand Inc., a diversified international industrial company based in Indiana, acquired Milacron Holding Inc. for approximately $2 billion in cash and stock. Hillenbrand acquired K-Tron in 2010 and Coperion in 2012, then merged the two in 2013. The combined companies are a global supplier of extruders, compounding machines, feeders, pneumatic conveying components and complete materials-handling systems.
It’s hard to imagine a bigger transaction in the plastics machinery business for U.S. processors. Milacron will become stronger through access to Hillenbrand’s broad plastics market, and it may have new opportunities to cross-sell products. Hillenbrand has pockets deep enough to invest in Milacron’s long-term growth.
Another interesting financial transaction saw Arsenal Capital Partners buy a controlling stake in recycler Revolution Plastic, Little Rock, Ark. Arsenal is a New York-based private-equity firm that specializes in industrial and health-care companies.
Recycling markets are in turmoil, so Arsenal’s investment might be a head-scratcher for some. But a closer look at Revolution might provide clues.
Revolution has closed the loop: It markets a wide array of plastic products for the agricultural sector, then recovers, cleans and processes the plastics into the same products again. That is an interesting model in the fragmented recycling industry.
I doubt that Arsenal invested an undisclosed sum in a recycling company just to be seen as a good corporate citizen. Arsenal expects to make money, and it is a significant vote of confidence for Revolution’s business model. Others should take notice of Revolution’s business model and how the company creates value.
Ron Shinn, editor
