After 15 years as an employee-owned company, Clinton plastics maker Nypro Inc. said Monday that it is being acquired by a Florida company for $665 million.
Under the deal, Nypro’s employee shareholders will cash out and Nypro will become part of Jabil Circuit Inc., a St. Petersburg, Fla., firm that provides electronic product and supply chain management services.
Nypro employs roughly 900 in Massachusetts, and Nypro chief executive Ted Lapres said he expects Jabil to keep those jobs and operations in-state. Founded in 1955, Nypro has long had its headquarters at an old mill building in Clinton that Lapres referred to as the company’s “heart and soul.”
“We’ve had a 58-year history here in Clinton,” Lapres said. “I think they recognized how important this mill facility is [to that identity].”
Lapres called Nypro’s decision to explore a sale “difficult” given its success since becoming employee-owned in 1998. But, he said, the firm’s leadership realized that it had become difficult to grow under that structure because they were paying so much to retiring employees cashing in shares that they didn’t have sufficient profits to reinvest in the company. Globally, Nypro has 12,000 employees and operations in 10 countries, and brings in more than $1 billion in revenues annually.
“The industry dynamics, in part, drove us. The competitive landscape is changing more and more, and size matters,” Lapres said. “We see our competitors consolidating and getting larger at a time when our customers are asking us to do more and more.”
Jabil executives said Monday that they expect Nypro’s acquisition to accelerate the Florida company’s strategic growth plan by opening up new business opportunities in two of Nypro’s key markets, health care products and consumer packaging — segments that Jabil estimates could be worth $205 billion. Jabil’s annual net revenues top $17 billion, financial filings show.
“Combining Nypro’s capabilities and market presence with Jabil’s global scale and expertise should result in great things for customers, employees, and investors,” Timothy L. Main, Jabil’s chief executive, said in a statement Monday. In a conference call, Main confirmed his commitment to retaining Nypro employees, saying Jabil has a strong track record of keeping key employees through acquisitions. Roughly 20 percent of Jabil’s executive corps, he added, come from acquired companies.
The deal is expected to close in late May, after a vote by employee shareholders and approval from regulatory groups in the United States, China, and several other countries.