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May 31, 1999 02:00 AM

INDUSTRIAL CONTAINER BIZ STILL CONSOLIDATING

Bill Bregar
Senior Staff Reporter
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    ATLANTA—Consolidation should continue among plastic pallet and shipping container players, as firms move to become one-stop suppliers, industry officials said at SouthPack '99.

    ``From our perspective, we feel like we can offer a broader line,'' said Steve Townes, regional sales manager for Buckhorn Inc., a unit of Akron, Ohio-based Myers Industries Inc.

    Earlier this year, Myers expanded globally by purchasing the containers, totes and pallet division of France's Sommer Allibert SA for $130 million.

    The deal gave Myers a global reach, with plants in Paris; Barcelona, Spain; and Birmingham, England; plus an Allibert-Contico joint venture plant in Springfield, Mo., and a 50 percent stake in a factory in Anshan, China. Myers also gained sales offices in Europe and Mexico.

    The Myers, Buckhorn and Allibert businesses have become a combined force that does structural foam molding, injection molding and rotational molding.

    ``We can offer a complete package of small hand-carriable totes, several sizes of bulk containers and pallets, either as part of a system or stand-alone,'' Townes said at SouthPack.

    Five major suppliers of plastic pallets and collapsible shipping containers exhibited at SouthPack, held May 18-20 in Atlanta.

    Plastic materials-handling systems continue to grow steadily, replacing wooden pallets and crates. The numbers are astounding. According to a Wall Street Journal story last year, the U.S. economy gobbles up 400 million pallets a year. Plastics' share of that market is about 5 percent, SouthPack exhibitors estimated.

    Plastic pallets and containers can be re-used hundreds of times — a dramatically longer life span than wood.

    ``Eventually, everyone will be switching to plastic that has a closed-loop system,'' said Tina Leaf, marketing specialist at TriEnda Corp.

    That astronomic potential has drawn plastics molders that want a bigger chunk of the shipping market. In addition to the Myers-Allibert deal, several other major consolidations have happened in recent years:

    In a deal announced just before SouthPack, industrial thermformer Thermoform Plastics Inc. got into the captive pallet business by buying TransPak-USA of Charlotte, N.C.

    In early 1998, thermoformer Triangle Plastics Inc. bought TriEnda Corp., a major pallet thermoformer in Portage, Wis. This year, Triangle itself was consumed by Alltrista Corp. Alltrista, of Indianapolis, now has thermoforming sales of more than $150 million — making it North America's largest industrial thermoformer, according to Plastics News data.

    Four years ago, global packaging giant Linpac Group bought Ropak Corp., which makes collapsible shipping boxes at a plant in Georgetown, Ky. Ropak is now changing its name to Linpac Materials Handling.

    Linpac announced at SouthPack that it will build a second structural foam molding plant in Kentucky. Interviewed after the show, David Stewart, marketing manager, said the plant should begin production by the first quarter of 2000. Stewart said more details, including the city location, will be released soon.

    Kyle Howard of Linpac Materials Handling said at SouthPack that the consolidation helps suppliers offer complete lines. ``People are trying to get more and more of the market. We can offer so much more now [with Linpac and Ropak combined],'' Howard said.

    TriEnda's Leaf agreed. ``We wanted to be the largest thermoforming company in North America,'' she said at the company's booth.

    Alltrista also brings injection molding capacity through its Unimark Plastics Co. division. TriEnda is studying new injection molded shipping products for the dairy and beverage markets, Leaf said.

    Also at SouthPack, TriEnda displayed its twin-sheet pallet for the U.S. Postal Service and self-palletized shipping systems that combine a box sandwiched between top and bottom thermoformed pallets.

    The lure of pallets drew Thermoform Plastics of St. Paul, Minn., to purchase TransPak-USA, on May 4. TransPak-USA makes a self-palletizing system.

    Mark Ward, vice president of sales and marketing, said TransPak-USA has won business from small manufacturers by remaining flexible and keeping inventory on hand for quick shipment.

    ``We'll adjust our approach to the market, instead of dictating `this is what we'll do,'*'' he said.

    Another SouthPack exhibitor, Rehrig Pacific Co. of Los Angeles has remained an independent, family-owned company. Rehrig made a major investment to develop a two-piece injection molded plastic pallet. The molder had a major advantage, according to Mark Konopka, director of pallets for the eastern United States: strong business with soft drink manufacturers such as Coca-Cola Co. and Pepsi-Cola Co., and making curbside recycling bins.

    Konopka said Rehrig was already a major supplier of can and bottle trays, when, about a year and a half ago, Coke encouraged the company to look at plastic pallets. Rehrig first developed a pallet specifically for beverages, then started looking at standard-sized pallets. In January, Rehrig introduced a two-piece pallet measuring 48 inches by 40 inches, injection molded of copolymer polypropylene. The company has added a 48-by-36-inch pallet.

    ``We consider it the Cadillac of plastic pallets,'' Konopka said.

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