Published in Economic Development

Growth Report: Sept. 28,2019

BY MIBIZ STAFF Saturday, September 28, 2019 11:05am

Growth report for Sept. 28, 2019.

M&A

  • Winn, Mich.-based Morbark LLC, a maker of forestry, tree maintenance, biomass, land management and recycling equipment, has signed an agreement to sell all of its outstanding capital shares to Seguin, Texas-based equipment manufacturer Alamo Group Inc. (NYSE: ALG) for $352 million. Morbark, which employs 720 people in Michigan, Ohio and Quebec, generated $225.5 million in sales for 2018. The deal, which is subject to closing conditions, is expected to close in the fourth quarter of this year. Morbark President Dave Herr will stay on with the company after the transaction. Private equity firm Stellex Capital Management LP has owned Morbark since 2016, completing two bolt-on acquisitions. Stellex and Morbark were advised on the deal by Baird and the law firm of DLA Piper.
  • A subsidiary of RDV Corp., the family office for the DeVos family, has acquired a stake in Sweden-based private equity firm Nordic Capital. Terms of the investment by Ottawa Avenue Private Capital LLC were undisclosed. In an announcement, Nordic Capital described the investment as Ottawa Avenue Private Capital acquiring “a passive minority equity interest” that will strengthen its balance sheet, enabling the firm to “further invest in its businesses.” A spokesman for RDV Corp. declined comment, other than tell MiBiz via email that “as a matter of company policy, we do not provide insights regarding our investing strategy.” 
  • An affiliate of Grand Rapids-based Universal Forest Products Inc. (NASDAQ: UFPI) acquired Hartford, Wis.-based Pallet USA LLC, expanding Universal’s industrial product capacity and services in the Midwest. Pallet USA operates one facility that manufactures pallets and crates. The company also distributes industrial lumber and sheet stock and provides services such as heat treating, pallet removal and recycling, custom product design, delivery and managed inventory programs. Terms of the deal were not disclosed. 
  • Cadillac-based Wedin International Inc. has acquired PGM Products Inc., a Warren, Mich.-based ball screw manufacturer, according to a report in Industrial Machinery Digest. The asset purchase also included all of PGM’s machinery, which Wedin is relocating to Cadillac. Wedin, a machine tool drive component manufacturer, also acquired the former assets of Modern American Ball Screw Manufacturing and PGM Ball Screw USA Manufacturing in the deal, according to the report. Terms of the transaction were not disclosed. 
  • The Hagerty Group, a Traverse City-based insurer of classic cars and high-end automobiles, has acquired the Greenwich Concours d’Elegance, a 25-year-old family-run car show in Greenwich, Conn. Terms of the deal were not disclosed. 

Expansion

  • Graphic Packaging International LLC plans to invest $600 million to install a new paperboard machine that will increase manufacturing output by more than 70 percent in Kalamazoo. The project on a vacant brownfield site will allow Graphic Packaging to manufacture approximately 900,000 tons of coated recycled paperboard annually in Michigan, representing 44 percent of North American production of the product. The Michigan Strategic Fund board approved a State Essential Services Assessment exemption for up to 15 years in support of the project. The board also approved the Kalamazoo County Brownfield Redevelopment Authority for a work plan including local and school tax capture for more than $21 million for the company. 
  • Holland-based ITB Packaging LLC plans to expand with a $3.5 million capital investment and the expected creation of at least 65 new jobs over the next five years. West Michigan Works! will support ITB’s expansion with more than $546,000 in staff time, worker training grants and on-the-job training. The Michigan Strategic Fund also provided ITB Packaging a $325,000 performance-based grant to support the expansion. ITB Packaging, based in the former Reddi-Whip plant on the north side of downtown Holland, plans to lease additional space at 430 W. 18th St. in Holland and add roughly 30,000 square feet of office and manufacturing space with an option for an additional 52,500 square feet. 
  • Plascore Inc., a manufacturer of lightweight composite products, is investing nearly $6 million to expand its footprint in Zeeland. The company expects to build a new 80,000-square-foot facility at 450 E. Roosevelt Ave., where its plans to create 35 jobs over three years, according to Lakeshore Advantage, the economic development organization that serves Ottawa County. 
  • After five years in operation tucked away in a nondescript office building along U.S. 131, mead maker Arktos LLC plans to move to a new location along Grand Rapids’ bustling Bridge Street corridor. The company is in the process of building out space at 442 Bridge St. NW for its new mead hall and production facility. Owner Maciej Halaczkiewicz believes the foot traffic at the new location will help expose more people to the business, which has operated for its first five years at 1251 Century Ave. SW, near the U.S. 131 and Hall Street interchange. The new location will allow Arktos to nearly triple in size and provide needed storage space for the manufacturing side of the business, Halaczkiewicz said. 

Higher ed

  • Trustees at Grand Rapids Community College will pay $2 million to purchase a 50,000-square-foot former JCPenney store in Holland Township to convert it into a consolidated Lakeshore campus. The site is located at the Shops at Westshore mall near the intersection of U.S. 31 and James Street. The new Lakeshore campus building will allow the college to consolidate programs and student support services in a larger space, increase employer and educator partnerships and enhance learning and teaching, according to GRCC. 

Life sciences

  • Grand Rapids-based Tetra Therapeutics says it is enrolling patients faster than expected for a clinical trial on a potential new drug to treat Alzheimer’s disease. Formerly known as Tetra Discovery Partners Inc., the company said it now has more than half of the patients needed for the Phase 2 clinical trial on a compound known as BPN14770. That enrollment progress could lead to quicker commercialization of the new drug, if clinical trials prove successful. The drug has shown promise during research and development to improve memory function in Alzheimer’s patients.

Economic development

  • Insurance giant Acrisure LLC’s plan to move 400 jobs from Caledonia to downtown Grand Rapids has garnered $7 million in state economic development incentives. The Michigan Strategic Fund board awarded Acrisure a Good Jobs for Michigan tax capture plan valued at $6 million, the first such award in the Grand Rapids area under the program. As well, the board approved a $1 million performance-based grant under the Michigan Business Development Program for the Acrisure project, in which the company plans to invest up to $33 million to move its global headquarters to the new downtown Studio Park development. 

Bankruptcy

  • The operators of Crowne Plaza Grand Rapids, a 320-room hotel near the Gerald R. Ford International Airport, have filed for Chapter 11 bankruptcy. Two related companies that operate the hotel, California-based Chhatrala Grand Rapids LLC and Bhogal Enterprises LLC, made separate bankruptcy filings on Sept. 16 in the U.S. Bankruptcy Court for the Western District of Michigan. In the filings, they claim their financial issues are related to the cost of improvements required by the hotel’s franchisor, England-based InterContinental Hotels Group PLC. In court filings, Chhatrala estimated it has between $0 and $50,000 in assets, but $10 million to $50 million in liabilities, while Bhogal said it had between $0 and $50,000 in assets and $100,001 and $500,000 in liabilities. 

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