Fontarome, which manufactures ingredients for flavors, fragrances and pharmaceuticals, entered receivership in January. It remained operational during the three months it was in receivership, and none of its 40 employees were laid off, a spokesperson said. It retained all of its customers.
Patrick McComis and Joe Froehlich lead SFM. Froehlich is managing director of Corporate Financial Advisors LLC in Milwaukee and McComis previously worked as vice president of contracts and compliance at Milwaukee prescription drug management firm Restat LLC.
“He just thought we’d be a perfect team to partner up together to acquire the assets,” McComis said.
McComis and Froehlich feel the fundamentals, staff, technical assets and intelligence are still strong, and the company simply needs an influx of capital.
“If you look at why the company ended up in receivership, it was really driven by one overriding principle, and that is that they were undercapitalized,” McComis said. “They just did not have the cash flow in order to meet their bills. Like anybody else … you start cutting back here and cutting back there, and it just becomes a downward spiral.”
The pharmaceutical industry provides opportunity to smaller developers like Fontarome, McComis said.
“I believe there’s been a paradigm shift in pharmaceuticals. The growth is really in the smaller, more boutique pharmaceutical manufacturers that need companies like ourselves to produce their pharmaceutical ingredients,” he said. “I just think that the demand for companies like ourselves will grow significantly in the future, so we’re uniquely positioned to meet their needs.”
The Fontarome name will be eliminated, and the company will go under the SFM title until a new name is established. McComis will become the president and Froehlich will sit on the board.
SFM will add 10 to 20 new employees in the next nine months, McComis said.
"Our new ownership team sees great value in the company and its future," McComis said. "We will change the operating name and invest capital in innovation, technology and people to grow the business in the U.S. and globally. Our Milwaukee location gives us a strong advantage for U.S. manufacturing (and) we have 30 years of impressive history in the pharmaceutical and flavor and fragrance industries to leverage and a talented team of employees."
All of the manufacturer’s employees will be retained and new employees will be added. McComis and Froelich will also develop a more integrated business plan with FCI SAS.
"We have a strong balance sheet today and a base of loyal customers," said Froehlich,who will serve on the new company's board. "We'll continue to provide the same products and the same services customers rely on while we improve our operations and increase our industry footprint."