MINNEAPOLIS, Minnesota, February 10 /PRNewswire/ - Genmar Holdings, Inc. (Genmar) announced today the successful spin-off of its VEC Technology business into a new stand-alone entity. The newly created company's official name is VEC Technology, L.L.C. (VEC LLC).
Based upon the completed transaction, the new company's value approximates $350 million. VEC LLC will be owned and operated as a stand-alone company with several strategic investors and partners.
Interplastic Corporation (Interplastic) became the initial strategic partner and investor with Genmar in VEC LLC. Interplastic Corporation's Thermoset Resins Division will be the exclusive supplier of resins to VEC LLC and its North American Composites division its distributor of most composite products.
Irwin Jacobs, Chairman of Genmar, stated, "The VEC process for boat building was successfully commercialized with the addition of a new state-of-the-art 100,000 square foot VEC boat manufacturing facility in Little Falls, Minnesota. Our Little Falls VEC plant has successfully built in excess of 20,000 VEC boats without a single structural failure. Additionally, boat manufacturing cost reductions and efficiency improvements continue to be achieved every month. The founders of VEC technology and Genmar as the acquirer and developer have always believed that VEC's market potential outside of the marine industry would eclipse those of the entire marine industry.
"Interplastic, as well as the other strategic partners and investors joining VEC LLC, also share in the same clear vision for VEC technology, a vision which addresses what professional experts have confirmed as an $11 billion potential market for the VEC process," Jacobs said. "The additional capital infusion associated with this transaction will enable VEC LLC to focus on its huge global business opportunities, as well as enable Genmar to concentrate on its marine business."
Jacobs further stated, "The next generation of VEC, a thermoplastic gel coat replacement called the VEC-Shield finish, will be launched through several of Genmar's boat companies in late 2004 and 2005. During 2004, Genmar will begin to expand and build new facilities to house the first new VEC-Shield equipment and machinery for building boats. GE Plastics (GE) and Spartech Corporation (Spartech) of St. Louis, Missouri are partners who have participated and continue to assist in developing the VEC-Shield finish. Spartech has designed and ordered the larger equipment necessary to produce the specialised thermoplastic sheet used by Genmar in its VEC-Shield boats. GE will supply their Geloy resin materials for use in the VEC-Shield finish."
Interplastic Chairman and Chief Executive Officer, James D. Wallenfelsz, stated "VEC technology is clearly a proven game changing technology that will in fact dramatically change the composite manufacturing industry. Our company has always been a leader in understanding and participating in the development of emerging technologies affecting our industry. In our opinion, VEC is by far the most significant and advanced process development for the manufacture of large fiberglass parts in decades.
"In addition," Wallenfelsz added, "the VEC process is in keeping with Interplastic's commitment to develop environmentally friendly products and processes, and the composites industry's goal of reducing Hazardous Air Pollutants. We are excited to be both a partner of VEC as well as an exclusive strategic supplier of resins and related materials for VEC and its existing and future customers. In a strong endorsement of VEC, in 2002, Christine Todd Whitman, the then Administrator for EPA, awarded VEC Technology the prestigious Clean Air Excellence award in the category of Air Technology, a first ever award to a boat manufacturer by the United States Environmental Protection Agency."
Sam Hughes, President of VEC LLC, added "Our entire VEC LLC organisation has worked long and hard to prepare VEC LLC for this day. The technology and innovations that VEC LLC has successfully created and perfected for Genmar's boat companies is only the tip of the iceberg when it comes to the opportunities that exist and lie ahead for VEC LLC. The interest by potential customers who have confirmed a need and desire to use our VEC process in their business has never been greater. VEC LLC has already developed a very significant backlog of business for our VEC cells with companies in a variety of industries. At this time, final installation of a VEC cell is being completed for a non-marine industry customer, who will be using the VEC process for the exclusive manufacture of certain bath products for the manufactured housing, modular housing and recreational vehicle industries. Further, there are seven VEC cells that are in the final order agreement phase, as well as three additional VEC cells for Genmar's boat companies also on order."
Full text of press release.