ACQUISITION: FastenTech Buys Stud Welding Associates

John Wolz

FastenTech Inc. has acquired Ohio-based BNC & Associates Inc. for $17.2 million cash. BNC, through its operating subsidiary, Stud Welding Associates Inc., manufactures and distributes stud welded fasteners and systems to the construction, industrial, energy, and marine markets. SWA specializes in cold heading of stud welded fasteners, accessory machining, and the manufacture of high-strength refractory anchors.
“This acquisition, coupled with our acquisition of Erie Bolt Corporation last month, bolsters our leadership position as a provider of highly-engineered, complex steel and high-strength alloy components, fasteners and application equipment,” stated CEO Ron Kalich.
BNC will become a unit of FastenTech”s Specialized Components segment, which reported an 18.2% sales growth to $185.6 million in 2005.
Despite a 35% jump in revenue to $327.5 million during fiscal 2005, FastenTech”s credit rating was downgraded from stable to negative by Moody”s Investor Service. The shift affects about $345 million of debt securities for the specialty fastener manufacturer.
Minneapolis-based FastenTech saw organic sales increase 11%, while revenue from acquisitions added $59.5 million to net sales. But revenue wasn”t the reason for the downgrade.
“Operating margins, however, have been negatively impacted by an adverse shift in mix away from higher margin aerospace-grade components, increased raw material costs that were not passed through in the application-specific segment and generally lower margins at the acquired companies,” Moody”s reported. \ �2006 FastenerNews.com