CHARLOTTE, N.C.—The new owner of Carlisle Companies Inc.'s Carlisle Transportation Products business is focused on growing the operation significantly.
"We want to be a billion dollar company," said Kevin Forster, CTP's president and CEO. "We're just under $800 million now, and we feel like we can grow to a billion dollars."
Carlisle completed the sale of CTP on Dec. 31 to private equity firm American Industrial Partners for $375 million.
The CTP unit includes Carlisle's specialty tire and wheel business and its power transmission belting operations. It manufactures and distributes bias-ply and radial tires, stamped and roll-formed steel wheels, and tire and wheel assemblies to non-automotive customers, and power transmission belts and related components.
CTP has seven manufacturing facilities. It produces tires at plants in Clinton, Tenn.; Jackson, Tenn.; and Meizhou, China. It manufactures belts in Fort Scott, Kan., and Springfield, Mo., and produces wheels in Aiken, S.C., and Ontario, Calif.
The unit also consists of 10 distribution centers in the U.S. and Canada, along with ones in Roosendaal, Netherlands, and Meizhou, China.
The business will continue to offer products under the Carlisle brand name.
Forster is not concerned about profit margins, even though that was one reason Carlisle sold its CTP business in the first place. David Roberts, Carlisle chairman, CEO and president, outlined a standard of 15 percent earnings margin for Carlisle business units during a conference call in July 2013. CTP reported a 6.7 earnings margin in 2012.
CTP reported 2012 sales of $778 million and $52.4 million in operating income. The tire and wheel business represented an estimated $375 million to $400 million of the revenue total. Forster said the margins are acceptable, but the firm feels like it can expand them over the next few years.
In doing so, Forster said AIP will make significant investments focusing on manufacturing systems. He said the firm plans on investing in new manufacturing technology for lean production and add more automation in its wheel plants.
"I think AIP has folks who understand manufacturing," Forster said. "They've got operations specialists inside their group. I think their perception is this company is pretty well run, and they want to make investments to improve and grow the business. Carlisle had invested more to right size the business. Now under AIP, we can invest for growth."