IPO Report: Milacron Holdings (MCRN)

Francis Gaskins |

milacron holdings IPO, milacron holdings IPO date, milacron holdings IPO price, IPOs this week, stocks to buy now, small-cap stocksMilacron Holdings (MCRN) is a global leader in the manufacture, distribution and service of highly engineered and customized systems within the $27 billion plastic technology and processing industry. It is based in Cincinnati, OH.

Twelve other companies are scheduled to IPO for the week of June 22. The full IPO calendar is available at IPO Premium.

SEC Documents

Manager, Joint-managers: BofA Merrill Lynch, Barclays, J.P. Morgan, Baird, Credit Suisse, Goldman Sachs

Co-managers: KeyBanc Capital Markets, William Blair

End of lockup (180 days): Tuesday, December 22, 2015

End of 40-day quiet period: Tuesday, August 4, 2015

MCRN scheduled a $300 million IPO with a market capitalization of $1.4 billion at a price range midpoint of $21 for Thursday, June 25, 2015 on NYSE.

Milacron Holdings IPO Summary

MCRN is a global leader in the manufacture, distribution and service of highly engineered and customized systems within the $27 billion plastic technology and processing industry.

Milacron Holdings Valuation


Valuation Ratios

Mrkt Cap (mm)

Price /Sls

Price /Erngs

Price /BkVlue

Price /TanBV

% offered in IPO

Milacron Holdings (MCRN)








Milacron Holdings IPO Conclusion


Holds top market positions

Q1 rev flat at $279mm , lost 3% of sales

64% of rev tied to consummables

P/E -44% (loss of -$8mm)

Price to bk of 2.9

Price to sales of 1.3

35% gross profit

1/2 of proceeds to pay dividends

Milacron Holdings Business

MCRN is a global leader in the manufacture, distribution and service of highly engineered and customized systems within the $27 billion plastic technology and processing industry.


Approximately 61% of MCRN’s 2014 sales and 64% of its sales for the three months ended March 31, 2015 are tied to consumables, which MCRN defines as products that are replaced and services throughout the life of the injection, extrusion and blow molding systems and fluids used in the metalworking process.

New Equipment

Advanced Plastic Processing Technologies’ sales of new equipment comprise the remaining 39% of MCRN’s 2014 sales. MCRN serves these markets through three segments:

--  Advanced Plastic Processing Technologies (“APPT”);

--  Melt Delivery and Control Systems (“MDCS”); and

--  Fluid Technologies (“Fluids”).

Through its APPT segment, MCRN offers injection molding, blow molding and extrusion equipment as well as aftermarket services and parts.

Milacron Holdings Top Market Positions

Based on management estimates, MCRN believes it is the #1 manufacturer and supplier of plastic processing technologies in North America on a consolidated basis across the industry’s primary plastic processing machinery applications based on sales.

MCRN believes it is the #1 manufacturer and supplier of injection molding technologies in India based on sales. MCRN serves a diverse set of customers and geographies, including many companies that manufacture products such as food and beverage containers, consumer goods packaging, electronic components, medical devices and automotive parts.

MCRN’s long track record, well-established brand names and reputation for product quality have resulted in a large estimated installed base of over 23,000 machines in North America and 17,000 machines across Europe and the rest of the world.

MCRN supports this large installed base with a full suite of aftermarket parts and services.

Through its MDCS segment, MCRN offers hot runner and process control systems, mold bases and components and numerous other technologies for injection molding applications, as well as MRO supplies for other plastic processing operations under its Mold-Masters and DME brands.

The Mold-Masters product line includes highly engineered, proprietary hot runner systems, process control systems, aftermarket parts and related services while the DME brand offers mold bases and related components.

Milacron Holdings Top Hot Runner Position

According to Interconnection Consulting, MCRN holds the #2 market position in the global hot runner industry based on sales, the #1 market position in the Americas, the #1 market position in Europe and a growing #2 market position in Asia, with a focus in the electronics and medical end markets.

MCRN believes that its MDCS business and aftermarket parts and services business provide it with a recurring revenue streams that generate attractive margins.

Milacron Holdings Intellectual Property

MCRN’s intellectual property portfolio, and in particular product designs with MDCS and proprietary chemical formulations used in its Fluids business, serve an important role in protecting its and its customers’ competitive positions by building barriers to entry and increasing switching costs.

MCRN’s recent Mold-Masters and Kortec acquisitions have added significant intellectual property related to hot runner system design and functionality, which MCRN believes provides it with a competitive advantage. In connection with its patented and proprietary technologies,

MCRN holds a number of trademarks worldwide that it believes are important to protecting its brand.

Milacron Holdings Competition

In general, plastic equipment competitors are large companies that compete with MCRN on a global basis.

Some are divisions of larger companies, and some offer an extensive range of plastic processing machines for extrusion, injection molding, blow molding, compression molding and thermoforming processes.

MCRN’s main machine competitors are Arburg (Germany), Battenfeld Cincinnati (Austria, which includes American Maplan (United States)), Bekum (Germany), Davis Standard (United States), Engel (Austria), Graham Engineering (United States), Haitian International Holdings (China), Husky (Canada), Krauss Maffei (Germany, which includes Netstal Maschinen AG (Switzerland)), Sumitomo Heavy Industries (Japan) and Toshiba (Japan).

Many of MCRN’s international competitors have recognized the attractive opportunities that exist in North America and have made efforts to penetrate the market.

Milacron Holdings 5% Shareholders Pre-IPO

CCMP   79.1%

AIMCo 15.2%

Milacron Holdings Dividends

No dividends are planned.

Milacron Holdings IPO Use of Proceeds

MCRN expects to receive $276 million from its IPO and use it for the following:

(i) repay a portion of the term loan debt outstanding under the New Term Loan Facility and (ii) repay up to $15.0 million of debt outstanding under the ABL Facility to the extent any amounts are outstanding upon consummation of this offering. The term loan debt to be repaid has a maturity date of September 28, 2020 and the effective interest rate per annum applicable to MCRN’s New Term Loan Facility is set based on a defined LIBOR rate plus a margin of 3.50% per annum (following this offering the margin will range from 3.25% to 3.50% per annum based on its leverage ratio). At no point will such LIBOR rate be less than 1% and as of March 31, 2015 the defined LIBOR rate was at 1%.

The net proceeds from the New Term Loan Facility were used

(i) to repay in full $339.1 million principal amount outstanding under MCRN’s existing term loan facility,

(ii) to redeem in full $220.0 aggregate principal amount outstanding of its Senior Secured Notes on May 15, 2015 at a redemption price of 106.281% of the principal amount thereof, plus accrued and unpaid interest, to, but not including May 15, 2015 and

(iii) to pay an approximately $145 million cash dividend to the holders of MCRN’s common stock.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


Symbol Name Price Change % Volume
MCRN Milacron Holdings Corp. 15.20 -0.34 -2.19 103,209


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