By LOU WILIN
Advanced Drainage Systems, the world’s largest producer of corrugated plastic pipe, plans to make an initial public offering of stock.
The company, based in Hilliard, employs 212 at its Findlay offices and factory.
About $300 million would be raised by the stock offering, estimated Renaissance Capital, a research firm specializing in initial public offerings. Advanced Drainage Systems plans to use the proceeds for general corporate purposes and to repay debt, the company reported in a filing with the Securities and Exchange Commission.
Advanced Drainage has not yet set a date for the stock offering. Nor has it disclosed the number of shares to be offered. Chairman and Chief Executive Officer Joseph Chlapaty declined to be interviewed for this story.
Advanced Drainage employs 3,700 globally. In 2005, it bought Hancor, in Findlay, then its largest competitor. Advanced Drainage Systems has 58 factories and 28 warehouses, including two factories and three warehouses in Canada, four factories in Mexico, four factories and five warehouses in South America, and one warehouse in Europe.
It also has a fleet of 625 tractor-trailers and 1,100 trailers to haul pipe and fittings.
Its pipes and other drainage products are used in storm water and sanitary sewer systems in commercial, institutional, manufacturing and housing construction; in agriculture; and in streets, highways, sewer systems, airports and railroads. Its pipes and products also are sold by Lowe’s, Menards, Home Depot, Ace Hardware and Do it Best.
Advanced Drainage Systems has been growing. Last year it opened a factory in Brazil for a joint venture with Tigre S.A., and added distribution supply yards in Morrisburg, Ontario, and in Moncton, New Brunswick. It added a fourth manufacturing line to its Saint-Germain, Quebec, plant.
It also bought two competitors.
It bought a controlling interest in a new joint venture with BaySaver Technologies, of Mount Airy, Md. The new company, Bay-Saver, continues to be based in Mount Airy and focuses on storm water filtration and separation technologies.
Advanced Drainage Systems also bought Inlet & Pipe Protection of Naperville, Ill., a maker of storm water inlet filters used to trap debris.
Advanced Drainage Systems’ assets grew from $714 million in 2009 to $907 million in 2013. It earned $28 million profit in 2013 on $1 billion in sales.
Prospects are good for more growth, with an improving economy, more construction and the need to fix aging sewer and water systems, the company reported. Demand for large-diameter pipe in the United States will increase at an average rate of 6.2 percent per year to 2016, estimated Freedonia, a business research company.
The pipeline business is looking upbeat in other countries, too.
“We believe the increasing acceptance of thermoplastic pipe products in international markets represents an attractive growth opportunity,” the company reported.
Demand for pipe products will grow for at least the next several years in Canada and Latin America, the company said.
“In Mexico, Central America and South America, additional investments in modern storm and sanitary sewer systems are needed to support the economic growth and development occurring in those nations,” Advanced Drainage said.
Wilin: 419-427-8413 Send an E-mail to Lou Wilin
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