IRVINE, Calif.—Royal Adhesives & Sealants L.L.C. has acquired Bacon Adhesives from Class Polymers in an effort to grow its presence in the aerospace, defense and electronics industries.
Bacon is a developer and manufacturer of highly specified, electrically and thermally conductive adhesives for demanding aerospace and defense communications, avionics, satellite and other electronics applications, Royal said in a news release.
The firm added that Bacon's production facility is AS 9100 aerospace quality system certified.
Financial terms were not disclosed. Bacon has about 12 employees at its only manufacturing facility, a 26,000-sq.-ft. building in Irvine. Royal Adhesives CEO Ted Clark said the firm now operates 18 facilities—13 in North America combining for about 1 million square feet, four in Europe combining for about 500,000 square feet and one 60,000-sq.-ft. plant in China—with its total employment increasing to 1,275.
Class Polymers Chairman Doug Frans said in a statement that Royal's global reach, sales model and knowledge of the aerospace and defense markets are ideally positioned to continue to support Bacon's growth.
Royal sees a lot of opportunity for Bacon's technology. Clark said Bacon has strong manufacturing and research and development capabilities, but not as much in the way of technical sales resources. He added that Royal fills that gap and can leverage its resources to help expand Bacon's customer base. The executive also sees some raw material synergies between the firms.
“This is a company that brings us well known technology,” Clark said of Bacon. “They're specified in all kinds of stuff. They have a lot of industry credibility, but we have the opportunity to spend more time directly with customers on new opportunities given we have the resources in the field.”
Royal's overall strategy consists of targeting niche adhesives areas, such as aerospace, defense and electronics. He said all three markets have been a focus for further development, and Bacon fits that objective.
“We choose niche areas we want to compete in and then try to grow organically and through acquisition,” Clark said. “We try to focus these activities around a theme.”
Royal's facility in Wilmington, Calif., is dedicated to the aerospace, defense and electronics markets, and is located about 20 miles away from Bacon's facility.
The firm's South Bend, Ind., plant also manufactures a lot of electronics materials, Clark said.
Bacon, however, is more directly involved in the adhesives market. He said the company develops highly engineered adhesives for specific use in avionics and communication-type command and control electronics—such as guidance systems. Bacon's adhesives consist mainly of polyurethanes or epoxies.
“We already had a line of electrically insulating products, so we were already involved in military, defense and electronics,” Clark said. “What this has really done has taken us to the other side of the equation with more conductive type of products. They also have magnetic and non-magnetic compounds used in guidance systems.”
Royal has had a busy 2016. Earlier in the year, Royal acquired the stock of Adhesive Systems Inc., a Frankfort, Ill.-based manufacturer of cyanoacrylate, methyl methacrylate, epoxy and anaerobic adhesives for assembly applications. ASI employs 68 at its 30,000-sq.-ft. facility.
Royal Adhesives is owned by American Securities L.L.C., a private equity firm with about $15 billion under management.
The company produces specialty formulated high performance adhesives and sealants.
American Securities acquired Royal in 2015. Based in New York with an office in Shanghai, it invests in North American companies with annual revenues ranging from $200 million to $2 billion, with $50 million to $200 million in EBITDA.