Cooper Standard looking beyond automotive, diversifying with acquisitions

Cooper Standard Automotive Inc. changed a lot in 2018.

After executing five major deals—four acquisitions and a divestiture of one of its primary product lines—Cooper Standard has reshaped its core product offerings and set the foundation for its non-automotive business.

The firm now operates under three automotive product groups: rubber and plastic sealing, fuel and brake lines, and fluid transfer hoses, plus its non-automotive Industrial and Specialty Group. Chief Operating Officer Keith Stephenson said the firm will continue to invest heavily in these areas, but long term Cooper Standard has set a goal for its ISG to account for 25-30 percent of its revenue within the 2023-25 time period.

“We love the automotive space, and we intend to continue to grow our business on the automotive side both organically and inorganically,” Stephenson. “But we also think we can leverage our technology into adjacent markets like commercial vehicle, industrial and agriculture.”

Branching out
Cooper Standard has leveraged its technology for non-automotive in a variety of ways.

Organically, Stephenson said the company has had success within the commercial vehicle and power sports areas. It also has secured licensing agreements to produce its Fortrex compound, a lightweight elastomeric material that combines the best attributes of EPDM and thermoplastic vulcanizates, two common materials used in sealing, in non-automotive applications.

In the third quarter, the firm said it had secured a second licensing agreement with an unidentified “major North American material compounding company with an extensive sales force and customer base.”

In the fourth quarter, Cooper Standard entered into an agreement with PolyOne Corp., allowing the company to sell Fortrex-based formulations into select markets. Cooper Standard said those applications include electrical/electronics, health care and complex industrial products. It will exclusively retain all rights to Fortrex and will generate revenue/profit from royalty income based on PolyOne’s sale of Fortrex.

“The business is growing organically and doing a very nice job there,” Stephenson said. “We’ve added some talent to the organization. We want to find additional bolt-on opportunities in the future in addition to growing organically.”

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