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LEWISTOWN - A local manufacturer of automated storage and retrieval systems was recently acquired by a Zurich, Switzerland-based company, Kardex AG.

Kardex AG has signed an asset purchase agreement to acquire the assets of U.S. competitor Kardex Systems Inc., which previously filed for Chapter 11 bankruptcy with a U.S. court.

Kardex Systems Inc. posted sales of approximately $21 million in the 2007 financial year, and has a staff of around 100.

Under the transaction, Kardex AG is acquiring the Kardex brand in the United States, a production site in Lewistown, and a sales organization with a broad base in the North American market.

A release from Kardex AG states that this will enable Kardex to substantially expand its U.S. distribution company, Remstar Inc. In addition, the merger of the two U.S. companies opens up sustainable synergy potential for Kardex and reinforces Kardex's market position in the United States.

Kardex Systems Inc. will now be known as Kardex U.S.A. Inc., CEO Joe Compitello said.

Compitello said this is an exciting time for the Lewistown-based facility, as the company plans to renew its lease with the Mifflin County Industrial Development Corporation. The Lewistown facility is located in the MCIDC Plaza in Granville Township, and if all goes according to plan, the facility will be expanding as well.

Compitello said that during the next six to nine months he expects to "double production capabilities" through equipment upgrades, facility expansion and the hiring of new employees.

Compitello said that during the coming months, engineers and technical staff will be brought in to supervise and implement the necessary upgrades to the Lewistown facility.

Compitello said the new relationship with the Zurich-based company is good news for his employees because Kardex AG is a "very viable and stable company."

"It's a good deal ... this is a very good opportunity for the people in Lewistown," Compitello said.

MCIDC President Rob Postal said the Kardex U.S.A. Lewistown facility is the center for North American production of the companies automated storage and retrieval systems.

"This is very good news for the community and the United States, it's very positive," Postal said of the economic impact.

"We will be working with Kardex to secure a long term relationship with the new company in the next couple of months," he added.