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Management Buys Control of Metal Tubing Maker

After nine years under Japanese ownership, Vernon metal tubing manufacturer Hannibal Industries Inc. has been acquired by its management.

Former owner Mitsui & Co. Ltd., a Tokyo-based metals and natural resources trading company, began seeking an acquirer for Hannibal a year ago, since most of the company’s U.S. subsidiaries are located in the Midwest or East Coast, said Hannibal President Blanton Bartlett.

“The people who have been here growing Hannibal are now in charge of Hannibal’s future,” said Bartlett. “We’ll take what we’ve done with Mitsui and expand it further.”

Terms of the transaction, conducted as an Employee Stock Ownership Plan, were not disclosed.

Mitsui, which reported $56 billion in sales last year, first invested in Hannibal in 1987 and became the sole owner in 1999. The company manufactures steel tubing for the construction, automotive, exercise equipment and other industries. Most of the 335 employees work at the company’s 22-acre Vernon headquarters.

In 2000, Hannibal added a materials handling division that builds pallet racks for retail and warehousing customers. The company has since become one of the largest manufacturers of storage racks in the Western United States.

Bartlett said the material handling division, which has grown between 10 percent and 15 percent per year, is far outpacing the rest of the company’s operations, which grow about 3 percent annually.

“I think most of our growth will happen on the material handling side,” he added.


Blade Work

Aerospace supplier Ducommun Inc. was awarded a $23 million contract to supply parts to the CH-47 Chinook Helicopter through 2010.

The Carson-based company will build titanium blade erosion caps, which help protect the leading edge of helicopter blades. The contract is a follow-on to previous deals awarded by Chicago-based Boeing Co., which builds and refurbishes the U.S. Army’s Chinook helicopters at its Philadelphia facility.

Ducommun executives said the company has refined its manufacturing process over the course of its lucrative relationship with Boeing. Work will be performed at Ducommun’s Gardena facility.

Separately, the company lost a member of its management team to another manufacturing company. John Walsh, executive vice president of strategy, technology and development, resigned to become president of Sypris Electronics, a subsidiary of Louisville, Ky.-based Sypris Solutions Inc.


Label Love

Avery Dennison Corp., a Pasadena-based manufacturer of office products, announced last week the acquisition of a Taiwanese label company.

Dean Scarborough, chief executive of Avery, said the purchase of DM Label Group will bolster his company’s standing in Asia and better enable it to serve its global customers.

“The DM Label Group strengthens our woven label product line and reinforces our presence in Asia, a major sourcing area for the global apparel, retail branding and marking industry,” said Scarborough in a statement.

DM Label Group, which specializes in high-quality woven and printed labels, has manufacturing facilities in five Asian countries and the United States. Terms of the deal were not disclosed.

With 37,000 global employees, Avery reported 2007 revenue of just over $6 billion.

Last month, Scarborough warned investors of weak business conditions and said most of the company’s earnings would come later in the year.


Corruption Contract

Tetra Tech Inc., a Pasadena engineering firm, has been named one of six contractors awarded a $750 million contract to combat corruption in foreign governments.

Under the contract, awarded by the U.S. Agency for International Development, Tetra Tech will assess foreign corruption and develop responses to it. The deal is somewhat unusual for the company, which has previously consulted for the government on water and environmental policy issues.

The company did not disclose the value of its share of the five-year contract.


Security Deal

OSI Systems Inc., a Hawthorne-based manufacturer of electronics for airport security checkpoints and other industries, won a $7.3 million contract last week to supply security devices to the Defense Department.

Under the deal, OSI’s security division, Rapiscan Systems, will supply the U.S. Army with Gamma Radiographic Detection Systems, which are used to detect concealed weapons, drugs or other illicit items.

The devices will be deployed in undisclosed international locations, the company said.


Staff reporter Richard Clough can be reached at

rclough@labusinessjournal.com

or at (323) 549-5225, ext. 251

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