Airpax Protector Group of Frederick, a $100 million business with 900 employees in Maryland, has been acquired by its senior managers and a venture firm from parent company Philips Electronics NV, the Dutch electronics giant, Airpax announced yesterday.
Terms of the deal were not disclosed. The new privately-held company is called Airpax Corp. LLC.
"We're very excited about it," said R. Patrick Forster, a partner of Industrial Growth Partners, the San Francisco venture capital firm that helped finance the transaction and will keep a stake in Airpax.
"We believe we're going to make a lot of money together," he added.
The deal comes at a time when Maryland has been losing manufacturing jobs and has seen control of its companies being taken out of state because of a spate of takeovers.
Despite having a West Coast financial partner, Airpax is expected to have extensive local autonomy, a spokesman said.
Airpax has its corporate offices and a manufacturing plant in Frederick, two plants in Cambridge and another in Matamoros, Mexico.
It has about 250 employees in Frederick, 650 in Cambridge and hundreds in Mexico, said spokesman Brent Hollenbeck.
The company also has a joint venture, Sanken-Airpax Co., in Japan with Sanken Electric Co.
Worldwide employment totals 1,600.
Philips is a conglomerate many have labeled the "European GE," a reference to General Electric Co.
As GE did in the 1980s under Chairman and Chief Executive Officer John F. Welch, Philips has been slimming down to focus on key businesses, which in Philips' case is consumer electronics and semiconductors.
Airpax, originally founded in Baltimore in 1947, has three wholly-owned units that are all good businesses but which didn't fit into Philips' plans. The company was put up for sale last spring, said Hollenbeck, the Airpax spokesman.
Airpax's Frederick subsidiary is Thermal Sensing Products Inc., which makes temperature-sensing products such as industrial thermostats.
Thermal Sensing customers include Thermo-King, which makes the powerful refrigeration units used by tractor-trailers that haul fresh produce, and Caterpillar Inc., whose trademark yellow-and-black dump trucks and earthmovers are used all over the world.
In Cambridge, Airpax has two units, Power Protection Products Inc. and Electronic Packaging Products Inc.
Power Protection Products makes industrial-strength circuit breakers, one of its major markets being the booming telecommunications business, Hollenbeck said.
Electronic Packaging makes products that house complex electronic components and shares many of Power Protection's markets and customers, the spokesman said.
Dennis Karr, the Airpax president and chief executive officer, said the productivity techniques instilled by Philips will be a big asset as Airpax becomes an independent company.
Under Philips, Karr received a number of corporate leadership awards, Hollenbeck said.
The company has grown partly by embracing some of the production techniques articulated by the late efficiency expert W. Edwards Deming.
Pub Date: 2/19/99