Shares of Onex Corp slipped by about 1% on Tuesday after the company announced it would be selling a majority stake in Precision Concepts International (PCI), a packaging solutions company, to The Sterling Group. The deal is being made through ONCAP, which is Onex’s investment arm focused on smaller and mid-sized businesses.
Sterling Group, based in Houston, will now take the lead in PCI while still working alongside ONCAP and PCI’s current leadership team to help the company grow further. The price of the deal wasn’t made public.
PCI, headquartered in North Carolina, runs five manufacturing plants across the U.S. and also has operations in Canada and Costa Rica. It provides packaging solutions mainly for personal care, household items, and food and beverage companies, especially in the small to mid-sized business space.
As part of the transition, Ken Swanson, the former CEO of another Sterling-owned company, Liqui-Box, will become Chairman of PCI’s board. The current CEO, Ray Grupinski, will stay in his role and continue leading the company day to day.
Leaders from both firms expressed excitement about PCI’s future. Sterling’s Greg Elliott praised PCI’s strong track record in customer service and quality, saying it sets a great foundation for national growth. ONCAP’s Ryan Mashinter also noted that ONCAP isn’t fully exiting, they’ll continue to be involved with PCI during its next phase.
The Sterling Group was advised by Evercore on the deal, while PCI received financial guidance from William Blair and Stifel. The market seemed to react modestly to the news, with Onex shares nudging down slightly, likely due to investors digesting the shift in ownership and future prospects for the asset.