Wicklund Holdings Co. has agreed to acquire recycled-rubber sports surfacing company A.T.G. Sports Industries, hoping to expand A.T.G.'s markets and augment Wicklund's other businesses.
The deal is expected to close sometime in January, said James Turek, president of Wicklund Holdings. A.T.G.'s management will remain the same, he said.
Known nationally as a premium installer of sports surfaces for schools, colleges, military installations and civic parks, A.T.G. mixes its rubber surfacing itself but buys crumb rubber on the general market and has no proprietary technology of its own, Mr. Turek said.
``What they've done is simply apply somebody else's technology,'' he said. ``It's not a patented process.''
The company has completed several projects in Mexico and Australia and reported about $5 million in sales in 2001, he said. Crews drawn from its 30 employees perform virtually all of A.T.G.'s installations, Mr. Turek said.
A.T.G.'s niche is in high-end projects where organizers can afford a premium product or need to repair or re-surface a shoddy surfacing job from the past, Mr. Turek added.
``You wouldn't believe how many of these tracks are installed with six or seven inches off the radius,'' he said. ``That can give a huge advantage to some of the runners during a race.''
With Wicklund's backing, A.T.G. should be able to pursue larger projects than it has in the past, Mr. Turek said.
``We can assist them in getting larger performance bonds,'' Mr. Turek explained. ``With our backing, instead of a $700,000 job, they can go after a $2.5 million job. They're capable of doing the jobs but don't have the ability to get the bonds.''
Performance bonds are insurance policies a construction company takes out to assure customers they will recover their money if the construction company dissolves or the job doesn't conform to specifications.
Drawing from Wicklund's asset base of about $20 million, A.T.G. will be able to finance larger bonds, Mr. Turek said.
A.T.G.'s contacts and reputation among athletic programs and directors across the nation will be a boon for Wicklund's other segments, too, he said.
After merging with International Plastics in the late 1990s, Wicklund has a stadium signage program and manufactures recycled engineered plastic fencing, parking blocks and seating. Wicklund also manufactures a line of plastic sports drinking bottles.
``A.T.G.'s already dealing with the athletic departments and the athletic directors, so from that we expect a lot of synergies,'' he said. ``It's one-stop shopping for the athletic director.''
Wicklund tries to focus on companies that work with recycled polymers and looks for firms with specialty niche markets that can benefit from its financial backing, Mr. Turek said.
The company's sales are about 50 percent manufacturing.
Wicklund is starting another company focused on the recycled rubber surfacing market, but one that would concentrate on small surfacing projects, such as tennis courts.
The new company would compete on some of the same projects as A.T.G., but not as a premium installer, Mr. Turek said.
``Certain schools can afford things that other schools can't, so this will allow us to target a wider market and still stay within our niche,'' he said. ``If a customer can't afford A.T.G., we can still try to get the bid with this company.''
Formerly traded on NASDAQ, Wicklund recently returned to the over-the-counter pink sheets where its stock currently is trading at a price of approximately 3 cents per share.
The company expects to post between $25 million and $30 million in sales in 2002, according to Mr. Turek.