Britton Group Plastics is set to expand following its £90 million ($150.3 million) purchase in a management buyout from ACX Technologies Inc.
London-based BGP already is the United Kingdom's No. 2 producer of polyethylene film, after British Polythene Industries plc. BGP operates 50 blown film and four cast film lines, and has capacity to process 143 million pounds per year.
``There are significant synergistic benefits to be gained, as well as attractive opportunities for making bolt-on acquisitions, in an industry which continues to consolidate,'' said Colin Smith, managing director of the Britton plastics division and leader of the buyout team.
Private equity provider CVC Capital Partners Ltd. worked with BGP management to take control of the former plastics division of Britton Group plc.
Already, BGP has committed to invest as much as $16.7 million this year on increased extrusion and converting capacity at several of its eight manufacturing sites across England. Last year the firm spent $12.8 million on film extrusion lines, printing presses and other new equipment.
In January, Britton Group was purchased by ACX Technologies of Golden, Colo. ACX was interested in Britton Group's six U.S. paperboard carton plants, and decided early on to divest the plastics operations quickly.
Commenting on the new deal, ACX President and Chief Executive Officer Jeff Coors said: ``I am very excited with the speed at which we were able to complete the sale of Britton Group Plastics, for the price we had expected.''
In the buyout, London-based CVC Capital is investing £23 million ($38.4 million) with the rest put up by senior BGP management led by Smith, former CEO of Britton Group's plastics division.
This is the second major investment made by CVC in the plastics field in as many months. In March the equity group led the $1 billion takeover of Cincinnati-based Formica Corp. and Australian Building Products, two businesses disposed of by London-based conglomerate BTR plc.
``Britton Group Plastics is a leading player in high growth, niche sectors of the flexible packaging and security markets, with a strong blue-chip customer base. The company is well positioned to exploit opportunities for expansion both organically and through acquisition,'' said CVC director Rob Lucas.
BGP, which showed a pre-tax profit of $13.3 million on divisional sales of $142 million last year, now comprises three distinct, but interdependent operating clusters: Britton Film, Britton Security and Britton Print & Conversion.
The film division produces multilayer cast and blown PE and PP film through two subsidiaries, Taco of Winsford and Polymon of Bletchley, England. Taco makes shrink film, industrial packaging, and films used in diapers, feminine-hygiene and medical products. Polymon serves the tire and rubber sector.
Britton Security Packaging manufactures tamper-evident flexible packaging. It has five plants at Hartlepool, Ilkeston, Louth and Southend-on-Sea, all in eastern England.
The print and conversion business extrudes, converts and prints film for food and dry cleaning, construction, and furniture and bedding sectors. It runs the English plants of Britton Precision, an extruder of low and medium density performance film at Louth; PE sack converter Britton Gelplas of Letchworth, and a printing plant, Britton Packbourne in Enfield.
BGP says its investment this year will include two new extrusion lines at the Taco plant, one a coextrusion machine for converter and technical films and the second, a single-layer line for shrink and industrial film.
At the print and conversion division, the firm expects to install two more extrusion lines by the end of this year. That includes a coextrusion line at Gelplas and a single-layer line at the Precision plant.