ExtruMed LLC, a Placentia-based maker of plastic tubes for medical devices, has been bought by a group of private equity investors led by Wedbush Capital Partners of Los Angeles.
Terms of the deal weren’t disclosed.
The move is part of a larger consolidation taking place in the medical devices industry, said Geoff Bland, managing director of Wedbush Capital, a private equity company that specializes in making $2 million to $7 million investments in businesses with annual revenue of $10 million to $50 million.
“What we see is, in the medical devices industry, an annual growth rate ranging between 12% and 25% a year,” Bland said.
The “graying of America” is fueling the growth as Baby Boomers approach retirement, according to Bland.
ExtruMed’s tubes technically are referred to as “multi-lumen” tubing. The tubes, or catheters, can be implanted into the body through minimally invasive surgical procedures anywhere from the kidneys and heart to the brain.
In Southern California, ExtruMed has two smaller rivals. They are Temecula-based Extrusioneering Inc. and Murrieta-based Medical Extrusion Technologies Inc.
Bland did not rule out possible acquisitions in a market prone toward consolidating.
“There is a lot of opportunity for the company to grow organically, but we are looking at acquisitions as well,” he said. “This (ExtruMed) is a leading supplier. We are less focused on geography than we are in finding the right fit.”
Vraj Lathiya, founder and president of ExtruMed, said the tubing made by his company is formed in different sizes, ranging from the microscopic for insertion into the brain to larger ones for angioplasty operations involving the heart or urological purposes associated with the kidney.
The catheter tubes are “made to order” for its largest customers. Those include Boston Scientific Corp., Guidant Corp., Medtronic Inc. and others.
Lathiya, 62, said he began ExtruMed 15 years ago when he bought the extrusion business from Costa Mesa-based Retroperfusion Systems Inc., which at that time had been shuttered after becoming a casualty of the recession and changing marketplace.
Retroperfusion Systems had employed a sizeable workforce of 100 employees who designed and built cardiovascular medical devices.
Since 1990, Lathiya moved the company first to Orange, then finally five years ago to a 12,000-square-foot facility in Placentia.
Lathiya, a former plastics engineer, said that the company has generated north of $5 million in annual sales. Roughly 10% of total sales have been derived from overseas sources, including Europe, Japan and Singapore.
Lathiya’s son, Apur Lathiya, is in charge of the company’s sales and marketing.
Other investors who partnered with Wedbush Capital to buy ExtruMed included Philadelphia-based Inverness Capital Partners and New York-based Fifth Street Capital.
Wedbush has invested in other Orange County companies, including Snapware Corp., a plastic food container maker which recently moved to Mira Loma from Fullerton, and IP MobilNet Inc., an Irvine-based designer and maker of private wireless data networks.
The majority of Wedbush Capital’s investments have been in the West, where it has invested in roughly 75 companies.
