Paper Converting Machine Company (PCMC) said that it plans to acquire F.L. Smithe Machine Company, a 105-year-old manufacturer of envelope machinery and the parent company of Aquaflex, which makes narrow web flexographic presses. Both parties are conducting due diligence, but expect that the sale will be completed in the near future.
According to Mark Gillis, global sales director for printing at PCMC, the Aquaflex name and products will continue. “We are absolutely committed to the narrow web and broader market,” he said. “Our plan is to continue to prosper with the brand.”
Aquaflex will exhibit at Labelexpo Europe in September, and executives from PCMC plan to be there, Gillis added.
A report of the pending transaction was published August 17 in the Altoona Mirror, a newspaper that circulates in the Pennsylvania, USA, region where F.L. Smithe is located. The report states that Board Chairman Edgar Smithe Jr., whose grandfather founded the company in 1904, wrote the following in a one-page memorandum to employees: “Mainly, business hasn't been too good for us ... and they approached us asking if we’d be interested in talking.”
Saying that the board and the owners are doing “what is best for the company and its employees,” Smithe wrote, “For some time now, the board of directors and senior management have been analyzing our company’s strategic alternatives, especially in light of the precipitous downturn we have experienced in sales these last 18 months due to the worldwide recession.”
The Altoona Mirror quoted Harry Zeznanski, an assembler and tester technician who is also head of Local 2348 of the machinist union, as saying that employees “have kinda seen the handwriting on the wall for quite some time.” Zeznanski also was reported as saying that two years ago, the plant employed 175 union machinists, compared with about 65 now.
Aquaflex and Webtron presses began as separate companies, but were acquired by Didde Corporation and shared that parent until early this decade. PCMC bought Webtron and the Zigzag brand of packaging presses, and Aquaflex was acquired by an investment company, American Capital Strategies. In 2004, F.L. Smithe bought Aquaflex and has manufactured presses under that name since then, introducing several new models over the years.
PCMC, which was since acquired by Barry-Wehmiller Companies Inc., has been inactive with the Webtron brand recently, Gillis said. “We have focused on mid and wide web technology.” Part of the reason PCMC is buying Aquaflex, he added, “is that Aquaflex has more momentum than Webtron had.”
F.L. Smithe is located in Duncansville, PA. PCMC is based in Green Bay, WI, USA. Barry-Wehmiller's headquarters is in Clayton, MO, USA.