Image By: Vista International Packaging LLC ViskoTeepak and Vista Packaging make film used in the meat and poultry industry.
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Topics Mergers & Acquisitions, Europe, United States, Food packaging, Film & Sheet
ViskoTeepak’s acquisition of Vista International Packaging LLC, in one sense, was more than four decades in the making.
Started by Hormel Foods Corp. in 1972, Vista came to life after the parent company had difficulty finding quality casings for its sausage products.
Vista, once created, turned to ViskoTeepak of Mariehamn, Finland, to become a supplier to the Kenosha, Wis., based food-packaging company.
Year after year, decade after decade, the two companies maintained their relationship. And by 2012, both sides saw value in ViskoTeepak, a maker of plastic and paper food casings, taking a 10-percent stake in the U.S. firm.
Vista had been the U.S. converting, sales and service representative for ViskoTeepak’s tubular plastic casings, cellulose casings and fibrous paper casings. These non-edible casings are sometimes used to process and then transport products. Other times, they are used to form products such as hot dogs before they are stripped away.
The initial equity stake in Vista by ViskoTeepak allowed the companies to work more closely together, including sharing information, and ultimately resulted in the complete acquisition of the firm.
For ViskoTeepak, the acquisition of Vista creates a Western Hemisphere beachhead through which it can better service its global clients in this part of the world.
For Vista, the deal gives the U.S. operations full access to research, development, support and knowledge from ViskoTeepak.
Becoming vertically integrated in the U.S. by combining the two companies provides business advantages.
“Now that we are one company, we keep our converting operations here in the U.S. There’s also synergies for ViskoTeepak in that we can now convert products in the U.S. and ship outside of the U.S. and service ViskoTeepak’s other customers in regions close to the U.S.,” said Ron Ramsey, vice president of sales and marketing for Vista.
“They saw it as a way to be more competitive in the U.S. marketplace by being vertically integrated,” he said.
Vista had been owned by private equity firm Keystone Capital Inc. since 2004, after Hormel decided to sell the business to allow it to grow as an independent operation. Some competing food companies did not want to do business Vista because it was owned by Hormel.
The change in owners solved that issue, but it also became obvious that the company would eventually be sold once again because of its ownership by private equity.
While Keystone Capital is more of a “buy-and-hold” firm, Ramsey said, there still was a desire to eventually sell the company.
ViskoTeepak will still continue to supply its existing partner companies in Canada, Mexico, Central America and South America. The company will now just be able to do it from Kenosha rather than Finland, Ramsey said. “It’s just more efficient for the operations,” he said.
ViskoTeepak is owned by Eriksson Capital Group and now employees more than 1,000 people with the Vista acquisition, the company said. Eriksson Capital also owns Optinova Ab, a maker of fluoropolymer medical tubing.
“Amongst other things, the acquisition allows us to optimize the total logistical chain and to evaluate, identify and implement what is commonly called ‘best practices’ within the field of converting, all aiming to improve our service level and product offering,” said ViskoTeepak CEO Ben Eriksson said in a statement.
With the latest deal, Vista will become ViskoTeepak as plans are to transition the brand by the “first of next year,” ViskoTeepak said.