Published in Economic Development

Growth Report: Nov. 9, 2019

BY MIBIZ STAFF Saturday, November 09, 2019 08:29am

Here is the growth report for November 9, 2019.

M&A

  • Automotive supplier Yanfeng US Automotive Interior Systems has entered into an agreement to sell the company’s Grand Rapids-area operations to Green Light Growth Partners LLC,  a new automotive-focused private equity firm in Bloomfield Hills. The business will be renamed and operate as Kendrick Plastics Inc. following the close of the transaction, which is expected in December. The sale will include all assets and operations associated with the facility at 5050 Kendrick St. SE in Cascade Charter Township. The plant employs 400 people and manufactures interior trim components for the automotive industry and has injection molding, paint and assembly capabilities. Honigman LLP advised Green Light on the deal, the terms of which were not disclosed. 
  • Kalamazoo-based Stryker Corp. (NYSE: SYK) plans to buy Wright Medical Group NV, a Netherlands-based maker of orthopedic products for the ankle, wrist, foot and shoulder, for $4 billion in cash. Directors at both corporations have approved the deal. The corporations expect the deal to close in the second half of 2020, pending regulatory approvals and the approval of Wright Medical shareholders. Stryker said the deal will not affect adjusted net earnings in 2020. The company expects the deal to be dilutive to earnings by 10 cents per share in 2021 and become accretive in the years after.
  • Grand Rapids-based restaurant operator Meritage Hospitality Group Inc. (OTCQX: MHGU) expanded its holdings in the Atlanta, Ga. market with the acquisition of five Wendy’s stores. Meritage expects the stores to add about $8.8 million in annual sales to the company and be accretive to earnings going forward. The deal complements Meritage’s existing portfolio of 39 Wendy’s stores in the Atlanta market, according to CEO Robert Schermer Jr. As well, the acquisition fits with Meritage’s growth strategy to operate 435 total restaurants — including a planned 400 Wendy’s locations — by 2025.
  • Office furniture maker Herman Miller Inc. has acquired the remaining shares of U.K.-based furniture designer and manufacturer Naughtone for $46.1 million. The deal, which closed Oct. 25, is expected to be accretive to earnings by 1 cent to 3 cents per share in the company’s current 2020 fiscal year, according to a statement. Zeeland-based Herman Miller (Nasdaq: MLHR) previously acquired a 50-percent stake in Naughtone in 2016 for $12.4 million. • Muskegon-based Conn Geneva & Robinson CPA and Consultants PC merged with Grand Rapids-based accounting firm Hungerford Nichols CPAs + Advisors LLC. Partners Pete Geneva and Rich Robinson and their firm’s staff joined Hungerford Nichols, which also added Kim Taylor Tax and Accounting in the deal. Clients will continue to work with the same staff. The transaction raised Hungerford Nichols’ workforce to 102 professionals. Terms of the deal were undisclosed. Hungerford Nichols has offices in Grand Rapids, Greenville, St. Joseph and Muskegon.
  • Health information networks Great Lakes Health Connect and Michigan Health Information Network Shared Services will combine operations by the end of the year. Great Lakes Health Connect, formed in Grand Rapids in 2010 by a coalition of West Michigan hospitals, will operate for a year as a wholly-owned subsidiary of East Lansing-based Michigan Health Information Network Shared Services, also known as MiHIN, as the two work out a final structure for their merger. Both nonprofit organizations will maintain their present offices and staffs in Grand Rapids and East Lansing.
  • Sault Ste. Marie-based Sovereign Communications LLC sold eight radio stations in Marquette and Iron Mountain to Fond du Lac, Wis.-based Armada Media Corp., according to a statement. Armada owns the Bay Cities Group of stations in Marinette and Menominee and the 10-station Radio Results Network group in Marquette, Escanaba and Manistique. Terms of the deal were not disclosed. Sovereign Communications continues to operate stations in Sault Ste. Marie, Newberry and across the eastern U.P.

Expansion

  • Specialty polymer manufacturer Polytek Development Corp. is investing $2.1 million in an expansion of its facility in Comstock Township, east of Kalamazoo. The expansion will allow the company to consolidate recently acquired operations into one location, according to a statement. The project is expected to create 28 jobs. The Michigan Economic Development Corp. is supporting the growth with a $112,000 performance-based grant from the Michigan Business Development Program. Kalamazoo-based Southwest Michigan First also helped the company access resources. 
  • Aquest Machining & Assembly plans to invest an estimated $1.3 million into an expansion of its current location in Greenville. The full-service fabrication and machining company plans to establish sheet metal fabrication operations involving laser cutting and forming at the facility, which will be made possible by a 7,500-square-foot addition to its building. The growth is expected to result in the creation of 12 jobs. The company currently has a 27-person workforce. The Michigan Economic Development Corp. is supporting the expansion with a $60,000 Michigan Business Development Program performance-based grant. 

Development

  • Management and development company LKV Ventures LLC will use a grant from Battle Creek Unlimited to help renovate a historic building in downtown Battle Creek. The $240,508 grant from the Real Estate Improvement Fund will allow Battle Creek-based LKV Ventures to white-box the first floor of the property at 70 E. Michigan Ave. to make way for commercial tenants. The second and third floors will include two one-bedroom apartments and a two-bedroom apartment. LKV Ventures anticipates the project will be completed in less than 12 months.

Health care

  • L.C. Walker Arena will become Mercy Health Arena at the end of the year under a $1.5 million sponsorship deal between the city of Muskegon and the health system. Mercy Health will pay $100,000 annually for 15 years for the naming rights to the 4,000-seat arena in downtown Muskegon that opened in 1960. Mercy Health is the largest employer in Muskegon and has an athletic and training center next door to the arena. The health system also sponsors the annual Seaway Run through downtown. 
  • O.B-Gyn Associates of Holland PC plans to open an office in Grand Haven. The new practice will offer obstetrics and gynecology services, including pregnancy care, contraception, annual screenings, treatment for endometriosis and menstrual irregularities, and menopause support. The company also has two offices in the Holland area and a location in South Haven.

Lawsuit

  • Kalamazoo-based Stryker Corp. is the subject of a federal lawsuit filed by the Instituto Mexicano del Seguro Social that claims the company for years used bribery “as an integral part of its world-wide marketing strategy” to sell medical products to the agency. The lawsuit, filed in October in U.S. District Court in Grand Rapids, accuses Stryker’s Mexican subsidiary of paying “tens of thousands of dollars in bribes to illicitly obtain contracts” with the agency that generated more than $2.1 million in profits. Stryker declined to comment on the lawsuit.

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