Roll-Kraft makes significant investment in Mace Security International
As part of the transaction, Roll-Kraft CEO Chuck Gehrisch and president Sanjay Singh have been appointed to Mace’s board of directors, effective Friday, March 9. Board members Carl Grassi and Daniel Perella resigned, also effective March 9.
Roll-Kraft makes tooling for companies in the tube, pipe and roll-forming industries, while Mace makes personal defense products like pepper spray as well as home protection and surveillance-related products. Mace president and CEO John McCann said the two Roll-Kraft executives have been seeking other investments because of the success they’ve seen at their own company.
Singh said Roll-Kraft has a relatively under-the-radar investment fund for this kind of work, and the company invests in manufacturing and service businesses in Northeast Ohio. While the company has made a couple of passive investments in the past, this is the first one in which it will take an active role. Singh said Mace has a strong brand name but is under-leveraged.
The release noted that RKI Inc. — the official name of the company doing business as Roll-Kraft — acquired the shares from accounts managed by Ancora Advisors LLC. (Roll-Kraft technically made the investment through an entity it owns and created just for the purchase of Mace shares, Singh said). The cost of the investment is not being disclosed, McCann said.
As part of the transaction, Mace’s board created the roles of executive chairman and executive vice chairman, electing Gehrisch as executive chairman and Singh as executive vice chairman. The two will work with Mace’s CEO and management team on “operational efficiency with the goal of creating an even more robust company,” the release stated. They will be eligible for compensation, based on Mace’s financial performance, the specifics of which McCann said are not being shared.
Roll-Kraft and Ancora, which maintains a strong investment in Mace, also have entered into a mutual voting agreement, which McCann said means they’ve said they will vote together.
Gehrisch as executive chairman replaces Richard Barone, who resigned as Mace’s chairman but remains on the board.
In a letter to shareholders, Barone said the new roles will have the “authority to manage and direct the day to day activities.”
Barone’s letter described the work that had been done to turn around the financial performance at Mace since he joined the board, from raising money through a rights offering to selling some businesses and acquiring others, but noted that the “hangover from the previous management team and their ill-advised acquisitions, however, proved harder to rectify than anticipated.”
With the addition of Gehrisch and Singh — and the approval of the new roles — Barone said in the letter that he was stepping down in order to allow leadership to “pass to those best suited to achieve organic growth of Mace product offerings.”