Deal enables Hanover-based Phillips Corp. to reinvest in growth opportunities
In a strategic move to fuel the growth of its ongoing business lines, Phillips Corporation, a Hanover, MD-based global supplier of manufacturing technology products and services focused on CNC machine tools and additive manufacturing, has sold its Haeger Insertion Machine division based in Oakdale California to Penn Engineering, according to SC&H Capital, the investment banking firm that facilitated the sale.
The parties finalized the transaction — the first Maryland-based manufacturing deal of 2018 — on Friday, January 19.
Given both companies are privately held, financial terms were not disclosed. Haeger’s employees are located globally and are expected to be retained at their current sites.
“Phillips has been receiving inbound inquiries about Haeger from possible buyers for years, and Phillips leadership began indicating an interest in exploring that option,” stated Richard J. (Rick) Morgan, retired bank executive and a longtime advisor and former VP of Finance of the company “Management recognized the need to develop a rigorous and thoughtful process to investigate strategic alternatives and so we brought in SC&H Capital about one year ago to help management prepare.”
“The management of Phillips was clear about their objectives from the very start. They wanted to find an attractive strategic path for Haeger and all its employees to grow and succeed to new levels, building on successes within Phillips Corporation. Only a deal that would truly benefit all involved would be considered,” said Matthew Roberson, the Director at SC&H Capital who led the transaction on behalf of Phillips. “In the end, we were able forge a transaction that is a true win for everyone.”
“This was not an easy decision. We believe in Haeger’s world-class offerings, its growth potential, its leadership under Wouter Kleizen, and all of the people who fulfill its mission to serve customers and drive innovation,” stated Alan Phillips, CEO of Phillips Corporation. “But the outcome here proves that we made the right decision. Haeger and Penn Engineering as a combined entity are poised for greater growth in the fastener market. We at Phillips are in an even stronger position to reinvest in key initiatives at Phillips Corp to grow our business that is headquartered right here in Maryland.”
The transaction between Phillips and Penn Engineering is emblematic of our experience in the M&A business, Roberson explained. “We work with business owners who want more than just the biggest financial return. They want to know all of the options and alternatives, and they want their employees to succeed and the culture they worked hard to cultivate to endure.”
“We take a lot of pride and a lot of pleasure in truly getting to know the people we work with — what their objectives, concerns, and ambitions are,” Roberson said. “Staying true to this philosophy allowed us to get this deal done, successfully ensuring both parties walked away satisfied.”
About Phillips Corporation
Phillips Corporation (phillipscorp.com) is a supplier of manufacturing technology products and services primarily focused on CNC machine tools (metalworking), engineered product solutions, and additive manufacturing technology. As the largest Haas machine tool distributor in the world, the company partners with metalworking customers to provide solutions and improve competencies for applying manufacturing technology, generating significant improvements in productivity, prosperity, and enduring competitive advantage. Phillips was founded in 1961 and is led by Alan Phillips who succeeded his father Albert Phillips as Chairman, President and CEO 25 years ago. The Company employs over 400 employees worldwide with operations in the US, India and China) with headquarters in Hanover, MD.
About Haeger Incorporated
Haeger is a manufacturer of hardware insertion machines, and is the world leader in the development of innovative fastener insertion technology solutions. For over 25 years, Haeger has pioneered and manufactured machines and tooling systems for inserting nearly every type and size of self-clinching fastener imaginable. Haeger machines are found in manufacturing facilities around the globe and is an integral part of the manufacturing process for leaders in industries such as automotive, computer servers, aerospace, solar panels and other areas where sheet metal fastening is critical to production.
About Penn Engineering
PennEngineering (pemnet.com) is a global leader in the fastening industry, having delivered the premier product in the thin sheet fastening industry for more than 70 years. The company’s solutions and engineering expertise benefit from ongoing investment in research, new product development, and strategic locations around the world.
About SC&H Capital
SC&H Capital, an affiliate of SC&H Group, is an investment banking and advisory firm providing merger and acquisition (M&A), employee stock ownership plan (ESOP), capital raising, and business valuation solutions to middle market and growth companies nationwide. SC&H Capital delivers investment banking and advisory services across numerous industries including technology, healthcare, manufacturing, and government contracting to help owners achieve their exit planning goals and liquidity objectives. To learn more visit www.schcapital.com.
