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Thursday, Mar 28, 2024

Companies Seek New Business Lines, Enter Into Mergers

Manufacturing in the greater Valley area has seen numerous changes over the past year including Pratt & Whitney Rocketdyne’s increased expansion to other business models, acquisitions involving several companies and the addition of a new Mission Foods plant. Pratt & Whitney Rocketdyne is ramping up efforts to develop alternative technologies to expand beyond the rocket and shuttle engines it is known for. Tortilla and corn flour products maker Mission Foods opened a 20,000-square-foot factory in Panorama City last September, bringing more than 400 jobs to the area. By 2013, the factory is expected to produce about 12 million tortillas per day. The new facility, which is LEED Gold-certified, is one of several Mission Foods plants in Southern California. The facility’s sustainability efforts are expected to save more than 1,250 metric tons of direct carbon emissions, which is equivalent to removing 250 vehicles from the road annually. While the company has delved into energy generation and other technologies for decades, these areas have recently taken on an even stronger focus. This is particularly due to the fact that NASA has pulled back from certain programs and is taking its time to announce what its next steps will be after the end of its Space Shuttle program in June. “Time is running out before we’re going to have to guess where we’re going and then start heading in that direction and see if we were right,” said John Vilja, the company’s vice president of strategy, innovation and growth, who said lack of timely action by NASA could lead to downsizing of staff and operations for Rocketdyne. “We’re likely going to have some kind of employment imbalance here fairly shortly.” Vilja said Rocketdyne’s San Fernando Valley employment base has already been cut by about 400 employees over the past year, largely due to layoffs and an early retirement buyout program offered by the company. “We’re looking at off-shooting to other things other than rocket engines because that will help us get a better balance of the fixed prices and the fixed costs if the launch business starts to shrink down,” Vilja said. Some of those off-shoot efforts include finding demo plant locations and partners for its gasifier technology – which converts coal into clean energy – and its hydrogen generator unit; setting up commercial plants for its solar energy technology; and developing electronics technology that uses a higher level of energy in smaller spaces. The company is also researching various other future technologies. “They range from internal combustion engines to making propellants out of algae to burning trash for power,” Vilja said. Rocketdyne, which has largely had its business dominated by government contracts, is also working to boost relationships with prospective commercial clients. Ownership changes Jet and space shuttle engine manufacturer Pratt & Whitney Rocketdyne is increasing activity in developing alternative technologies. Those technologies include its gasifier technology, which converts coal to clean energy, its solar power technology and special electronics. The Canoga Park-based company is making the move in the wake of uncertainty in the space program. The company is awaiting an announcement by NASA about what its next generation of spacecraft will be. At other manufacturers over the past year, nail polish maker OPI Products Inc. and AML Communications Inc. were bought by other companies while Teledyne Technologies Inc. has been acquiring firms. OPI, based in North Hollywood, agreed to be acquired by New York-based beauty care giant Coty Inc. Through the deal, which was announced in late November and is not yet closed, OPI’s former owner George Schaeffer and his management team are remaining with the company. Eric Schwartz, chief operating officer for OPI who has been with the company for 15 years, said the acquisition is not expected to result in major changes to staff, the company’s location or even its operations. What will change is that the acquired company will have access to more resources through its new owner. “They have a very strong retail platform and we have a very strong salon platform,” he said. “We’re looking to cross-fertilize. They also do a lot of licensing engagements with celebrities, and we do that too over here at OPI. There’s an opportunity to kind of leverage relationships over time.” Schwartz added that that merging with the larger company also gives OPI the opportunity to purchase materials in larger volumes. Camarillo-based AML Communications Inc., which produces small and light components used for the unmanned aerial vehicle market, also agreed to be purchased so it could leverage more resources. The $29-million acquisition by New York-based defense contractor Anaren Inc. was announced last month. “There comes a point in most small companies’ lives that if it doesn’t make it vary large on (their) own, it’s better to be part of a larger organization,” said Ed McAvoy, AML Communications’ vice president of sales and marketing. McAvoy said the two companies’ technologies complement each other and they both serve the defense market. He also said he does not anticipate any immediate changes for AML Communications. A more recent acquisition was by Thousand Oaks-based Teledyne Scientific & Imaging LLC, a subsidiary of Teledyne Technologies Inc. The company announced this month that it acquired a majority interest in Solvang, Calif.-based Nova Research Inc. The company, also known as Nova Sensors, designs integrated circuits, highly integrated camera electronics, and manufactures compact mid-wave and short-wave camera systems. Nail polish manufacturer OPI Products Inc. is in the process of being purchased by New York-based beauty product company Coty Inc. The North Hollywood-based company will add 200 colors of OPI Nail Lacquer chip-resistant formula to Coty’s portfolio. OPI’s management, which is remaining in tact, said the larger company will bring new resources to the OPI brand. George Schaeffer, OPI’s president and CEO, started the family business in 1981. Since then, it has become one of the largest nail care manufacturers in the industry. Teledyne Technologies – which provides electronic subsystems, instrumentation and communication products – has the option to purchase all the company’s shares after three years. “Our involvement in Nova Research Inc. further increases Teledyne’s involvement in infrared imaging systems for both commercial and tactical military operations,” said Robert Mehrabian, Teledyne’s chairman, president and CEO. “Along with the recent acquisition of DALSA Corporation, Teledyne can now offer a significantly expanded range of digital imaging components and complete camera systems spanning the X-ray, UV, visible and infrared spectra.” Beside the decision to purchase DALSA, which was announced in December, Teledyne has also acquired a majority share in Optical Alchemy, and it has acquired Optimum Optical Systems. Factory expansion One addition to local manufacturing this year was the Mission Foods factory that opened in Panorama City in September. The 20,000-square-foot plant is one of several facilities in Southern California owned by Mission Foods, which manufactures tortillas and corn mesa flower products. By the time the plant reaches full capacity in 2013, it will create more than 400 jobs and produce about 12 million tortillas per day. Mission Foods, headquartered in Irving, Texas, decided to move to the Valley Enterprise Zone after officials from the Mayor’s Office of Economic and Business Policy brought together multiple city departments to help expedite the planning and permitting process. Mission Foods invested more than $50 million into the development of the facility, which is LEED Gold certified and was designed to conserve energy and reduce greenhouse emissions.

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