PE-backed Angstrom Technology pursues acquisitions to fill cleanroom market gaps
WALKER — A couple of recent strategic acquisitions should further prepare cleanroom designer and builder Angstrom Technology Ltd. for overseas projects as the company continues a private equity-backed string of acquisitions.
After New York City private equity firm ASGARD Partners & Co. acquired a controlling interest in Angstrom in November 2020, Angstrom has persued deals to expand its presence across the world and bring new capabilities to its service offerings.
Angstrom specializes in designing, building and maintaining cleanrooms for manufacturers across a spectrum of industries, ranging from automotive and medical packaging to aerospace and gene therapy.
The Walker-based company is now focused on continuing to roll up what President Matt Isard called a fragmented cleanroom industry.
“There are a lot of different players in the industry, and it seems to be that no two cleanroom providers are the same,” Isard said. “Everyone seems to have their own unique spin to the business or industry. We do see an opportunity to consolidate and start to roll up some of these smaller to mid-size companies and basically buy their book of business, add our process and procedures to them and try to increase our footprint as Angstrom.”
As part of the ASGARD Partners portfolio, Angstrom has stuck to that deal-happy mantra already this year, opening 2022 by acquiring United Kingdom-based cleanroom manufacturer Connect 2 Cleanrooms Ltd. (C2C). The company followed that deal with the acquisition of England-based cleanroom design and engineering firm Specific Environments Ltd.
The acquisitions helped cement Angstrom’s presence in the European market while also bringing new revenue streams to the business.
For instance, C2C not only designs and installs cleanrooms, but it also delivers consumables to clients and can help with the validation and certification processes.
“Once a cleanroom is built, you need hair bonnets, shoe covers, neoprene gloves, suits — they distribute all that to the customer,” Isard said.
Before the overseas acquisitions, Angstrom in 2021 acquired Irvine, Calif.-based Built 2 Spec, which designs and builds turnkey cleanrooms, giving Angstrom a foothold on the west coast.
The geography of Angstrom’s growth is strategic as Isard strives to maintain a presence in regions that might be considered hotbeds for industries with high demand for cleanrooms.
As for its own clients, Angstrom avoids being weighted in any particular industry segment, pursuing opportunities in any industry that needs them. Isard said some of the hotter markets include medical packaging, cell and gene therapy, and aerospace.
Meanwhile, the firm is actively looking for locations as part of a possible expansion as it outgrows its space at 3509 3 Mile Road NW.
Stephen Rapundalo, president and CEO of statewide bioindustry trade group MichBio, sees the opportunity for increased demand for cleanrooms in his industry, citing a slew of expansions. This includes some, like Pfizer Inc., that are linked to COVID-19 vaccine production.
He also highlighted the cannabis industry, which he considers to be an emerging market.
“Another area of explosive growth is the cannabis space,” Rapundalo said. “We’ve got an upcoming event — a cannabis science symposium. We’ve seen increased interest and inquiries from cleanroom companies that want to participate and exhibit their wares. That’s an area that is growing by leaps and bounds.”
When assessing the state of cleanroom vendors available to Michigan companies, Rapundalo said the state has traditionally been home to smaller players, creating a need for suppliers that offer a fuller range of services that meet the more extensive needs of larger projects.
“It’s like with many other product areas, where you have to develop full spectrum solutions beyond just the physical infrastructure,” he said. “In order to do that, I suspect you have to have added capabilities somehow, whether that’s through organic growth or through acquisition. So, I think Angstrom has strategically decided on a path for its growth and it has aggressively embarked on that.”
Rapundalo also mentioned the expansion for Grand River Aseptic Manufacturing Inc. in Grand Rapids, which broke ground last fall on a $50 million, 18,000-square-foot expansion to its facility. This followed a $60 million, 60,000-square-foot expansion that opened in June 2020.
GRAM Vice President of Client Pharmaceutical Services John Wichelt explained that the bulk of work — formulation and filling — is done in cleanrooms. The company manufactures sterile injectables, requiring more extensive cleanroom measures.
“The type of manufacturing we do, the building and utilities are designed around supporting that cleanroom environment as well as other critical utilities,” said Wichelt, whose company manufactures the COVID-19 vaccine for Johnson & Johnson and works with Grand Rapids-based Midwest Cleanroom Associates for its cleanroom needs. “The cleanroom is one of the most critical areas of design.”
Cleanroom space is just as important for employers like Gentex Corp., the Zeeland-based Tier 1 auto supplier of digital vision, connected car, dimmable glass and fire protection technologies.
The manufacturer primarily addresses its cleanroom needs in-house, but it has worked with vendors before, including Angstrom Technology.
Paul Flynn, Gentex’s vice president of manufacturing operations, explained that 85 percent of Gentex’s operations involve a process that uses cleanroom space. They use these environments tactically, setting up smaller spaces for jobs like assembly, where they have to combat particulate matter and moisture.
This dynamic underscores how cleanroom space has come into higher demand as vehicle components advance in technological sophistication.
“As vehicle producers adopt optical technologies — these cleanrooms are needed to assemble camera and vision systems,” Flynn said. “Displays, too. … For any type of display, we will use a cleanroom for the assembly there.”
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