A local business, through the acquisition of another company, recently doubled in size, bringing new jobs and tax revenues to Floyd County in a down economy. Hawkeye Mold and Design, located southeast of Charles City, Iowa in May joined forces with Preferred Tooling of Shell Rock to become Hawkeye Preferred Tooling Group. The companies both specialized in custom mold building — the molds are used by other businesses to make parts for things like automobiles and appliances.
“Both companies worked in the same industry,” said co-owner Andrew Hobson, 41, of Waverly. “We just had different customer bases.” And both businesses wanted to expand them. Preferred Tooling generally manufactured larger tools than Hawkeye Mold and Design. “We both built molds but we were in completely different markets,” Hobson said. “Our customers never really crossed over.”
The companies were looking to grow in other ways. Hawkeye Mold and Design wanted to add to its sales and engineering staff and up its technological capabilities, while Preferred Tooling desired a more spacious facility where it could make bigger molds.
They both got their wishes. A total of seven employees and managers from the Shell Rock business relocated to the Charles City shop, bringing the staff there to 14 people. They also brought equipment, outfitting the building with a wire electrical-discharge machine and three computer-numericalcontrol machines — doubling the number of devices in the facility.
The businesses were able to make the move with the assistance of a forgivable job-creation loan and revolving loan fund from Charles City Area Development Corp.
Hobson noted how helpful Charles City Area Development Corp. was in getting the new business up and running, calling its executive director, Tim Fox, “very knowledgeable and a great guy to work with.” The loan is forgiven at the end of three years if Hawkeye Preferred Tooling Group keeps a certain amount of jobs. The revolving loan fund was used to purchase machinery and equipment for the facility, and is repayable over five years.
“I think it’s going to be a successful company,” Fox said. “It really blends two companies — it addresses the weakness of one that was the strength of the other.”
“It’s always laudable to have high-tech jobs in the county,” he added, saying that “Any job creation in this economy is positive. We wish them great success.”
The acquisition’s beginnings can be traced to last year, when Hobson’s father, Gerald, who founded Preferred Tooling in 2003, made it known that he was going to retire. Subsequently, in November, Andrew Hobson returned to the company he worked at from 2003-07 with the intention of buying it out. Hobson’s brother-in-law, Steve Stirling, was part owner of Hawkeye Mold and Design, which was founded in 2001; the other owner was Tim Rediske, who Hobson had worked with in the past. The three had known one another for 20-plus years. In February, they began talking about merging the two companies.
Hawkeye Mold and Design had recently undergone some staff changes — some of their engineering employees had left. Preferred Tooling, on the other hand, had a strong sales and engineering department, but wanted to move into a larger building.
“We had the sales and engineering staff. They had the shop floor,” Hobson said. “So it was kind of a natural fit to bring it up here and combine them all into one.” The deal, completed in May, was a win-win for both sides. The transition has been pretty seamless so far. The Charles City shop kept operating while the acquisition and move-in took place. Hobson brought Aaron Hickle, a manager from the Shell Rock shop, with him as a partner.
“It’s really amazing how smooth it’s all gone in a short amount of time,” Hobson said. Most of the company’s sales are domestic, but it has customers in such places as Malaysia, Brazil, Mexico and Europe. The staff includes some industrial technology students from NIACC.
Rediske, 59, of Waverly, said the businesses have been “a good combination,” acknowledging that “both companies needed to grow.”
Stirling, 40, of Nashua, said the acquisition “opens us up to a lot bigger market” and brings with it potential for even more growth.
Hickle — who worked at Preferred Tooling for seven years, the last four as manager — agreed, saying the size of the facility and land in Charles City allows for more expansion in the future. He said the building in Shell Rock was about one-fourth the size of the current one.
“This is more of an industrial setting here. It helps when the customer comes,” said Hickle, 30, of Charles City. “We needed room to grow and we’re in the right place to do it.”
Hawkeye Preferred Tooling Group is located at 2323 Old Highway Road in Charles City. For more information, call (641) 228-3099 or email firstname.lastname@example.org. Visit the business on the Web at hawkeyepreferredtoolinggroup.com.