Grede, a developer, manufacturer, assembler and supplier of ductile, gray and specialty iron castings and machined components for automotive, commercial-vehicle and industrial markets, announces it has purchased a Waukesha, WI, foundry from Renaissance Manufacturing Group (RMG) Waukesha. Terms of the transaction were not disclosed.
The foundry located 10 miles (16 km) west of Milwaukee will close July 31 and 119 full-time jobs will be lost when RMG’s supply contracts are transferred to Grede, according to reports in the Milwaukee Business Journal and (Milwaukee) Business Times.
Through a spokesman, Grede CEO Cary Wood declines to confirm the July 31 closing. Wood does say, however: “While we won’t share specific details on the assets acquired, we can say that the assets do include RMG’s existing contracts and that we will be transferring tooling into Grede’s facilities in Browntown, Liberty and Reedsburg, WI, and Biscoe, NC.”
In a letter notifying state officials of the layoffs, RMG Waukesha officials said: “We have recently seen a dramatic decrease in heavy truck sales, with higher than ever increasing business costs. This is occurring in a market where customers are demanding significant price decreases. The combination of events has forced us into selling the business to a buyer better equipped with product-to-process fit for improved product cost.”
The acquisition helps Grede better balance its portfolio equally among the automotive, commercial-vehicle and industrial markets, Wood says in a news release.
“Grede is well capitalized and poised for growth within a fragmented and distressed foundry supply base, and this strategic acquisition strengthens our position in the castings industry,” Wood says. “This investment further brings us new customers and aligns with the markets we are serving while expanding the products and materials we produce.”
RMG Waukesha acquired the Waukesha foundry from Navistar International in May 2015. Primarily a ductile iron operation since the early 1980s, the facility also produces austempered ductile iron, high-temperature and abrasion-resistant ferrous alloys and compacted graphite iron.
RMG Waukesha produces components for light and heavy truck, combustion engine, railroad, construction, agricultural and pump/compressor manufacturing. The company will continue to operate its other two locations in Grafton, WI, and Anniston, AL.
Southfield, MI-based Grede is an independent company acquired in December by Gamut Capital Management, a New York-based private investment firm, from American Axle & Manufacturing Holdings. The company has about 3,800 employees across 10 facilities in Alabama, Indiana, Michigan, Minnesota, North Carolina and Wisconsin.
“Grede is uniquely equipped to meet demand for high-quality casting products in a cost-conscious market,” Wood says. “We also have enough capacity to support added business that will come from on-shoring initiatives to reduce supply-chain risk, and we’re positioned to help our customers manage other risk factors and provide long-term solutions.”