each plant would take longer. He turned out to be right, in part
because Grede spent the succeeding year adding new facilities to its portfo- lio. In addition to Grede Radford, the company purchased Paxton Mitchell, which operated a metalcasting facility in Omaha, Neb., in November 2011. Seven months earlier, it completed the acquisition of Novocast and Teknik, both located near Monterrey, Mexico. “Everything we are doing right now
is to generate capacity,” Lovell said. “All of [the acquisitions] are strategi- cally focused and tied to customers.” Lovell said Grede has responded
to industry-wide capacity constraints by identifying value properties where it can improve effi ciency and produc- tion levels through lean initiatives. T at doesn’t always happen, and Grede has paid “fair market value” for at least some of its acquisitions, Lovell said. But whatever the cost, the goal is to make more castings for underserved markets. Grede purchased Novocast and
Teknik from Grupo Proeza in April 2011. Legacy Grede has had a long running relationship with the Mexican manufacturing group, at one point operating with Grupo Proeza through a joint venture at what is now the Novo- cast location. Proeza has maintained several of the same customers as the
new Grede through the years, making the acquisition in line with Grede’s current strategy. “T e acquisition of the NovoCast
and Teknik foundries [was] impor- tant for Grede because it expands our manufacturing footprint to allow us to supply key automotive, heavy truck and industrial customers in Mexico with a broad spectrum of ductile and gray iron components,” Grimm said. T e plant Grede purchased from
Paxton Mitchell, now known as Grede Omaha, was one the Grede acquisi- tion team judged was operating at depressed capacity utilization and could hold strategic value in the valve industry. According to Lovell, Grede’s ultimate goal is to divide its production evenly among its three target markets: automotive, heavy truck and general industrial. At the time of the merger with Citation, automotive customers
accounted for more than 50% of the new company’s business. T ey currently make up 44% of its customers. With heavy truck at 24%, Grede Omaha stands to be one of the keys to ensur- ing the remaining 32% stays devoted to general industrial customers. “We recognized a foundry out
there with a couple lines and the equipment necessary to support growth,” Lovell said. “We have some real solid customers, and we have brought in some new customers. It’s an opportunity to create more capac- ity in the marketplace because they were running very ineffi ciently.” Identifying opportunities like Grede Omaha isn’t easy. Lovell chalks it up to experience and exposure in the indus- try—its management team either fi nds plants where “the grass is growing a little high,” or others in the industry come to Grede with acquisition ideas.
Georg Fischer Automotive’s proprietary metal SiboDur is being used in Europe to make parts like this crankshaft. Grede has a license agreement with Georg Fischer to produce and sell the material in the U.S. and is considering pouring it at Radford.
October 2012 MODERN CASTING | 21
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