Casket maker to buy Pitman's K-Tron International

One of the nation's biggest coffin companies is buying industrial-equipment maker K-Tron International Inc. of Pitman for $435 million.

The deal announced yesterday should give Hillenbrand Inc. of Indiana, whose products include Batesville-branded caskets, new life outside the flat-growth death-care industry.

Hillenbrand will acquire K-Tron for $150 a share in cash. K-Tron's stock soared $34.77 to $148.29 on the news.

Kenneth Camp, chief executive officer and president at Hillenbrand, said K-Tron was a "terrific company with a great record and was very well-managed." K-Tron comes with an added benefit for the 64-year-old Camp: His mother, Edith, still lives in his childhood home in Pitman. Camp was raised in Pitman and graduated from Temple University.

"When I heard it was in Pitman I thought people would say I spent all this money to go see my mother," joshed Camp. He said the location in Pitman had no influence on his decision to buy the company.

K-Tron executives say that there is no overlap with Hillenbrand and that they anticipate no employee cutbacks.

The Pitman company engineers and manufactures industrial feeding equipment and coal crushers. One of its product lines shoots raisins into breakfast cereal. There are 650 K-Tron employees around the globe, 140 of them in South Jersey and the Pennsylvania suburbs.

Ed Cloues, the chief executive and chairman at K-Tron, said yesterday that K-Tron would have to borrow heavily to expand and that Hillenbrand was looking for "an exciting new business to invest in" - thus the deal.

During the last decade, K-Tron expanded into the crushing-equipment business by, among other things, acquiring Pennsylvania Crusher Corp. in Broomall and globalizing its feeder-equipment line, Cloues said.

Cloues will join the Hillenbrand board of directors when the deal closes and focus his attention on acquisitions for the Batesville, Ind., company, which had $649.1 million in revenue and $102.3 million in profits for the year ended Sept. 30.

Hillenbrand said in a regulatory filing that demographics and the popularity of cremation had led to the "steady decline in the total number of casketed deaths in North America."

Camp said in a conference call yesterday that Hillenbrand considered about 400 companies before selecting K-Tron.

The boards of K-Tron and Hillenbrand approved the deal, which now needs the approval of K-Tron shareholders, Cloues said. He said he expected that by late March.

Tim Maxwell, a senior partner at the Morgan Lewis law firm in Philadelphia, which represented K-Tron in the deal, said the acquisition signals an economic recovery. "This is an indication that the recession is coming to an end," Maxwell said. "Most of the M&A we have seen up to now has been opportunistic and for below-market values."