Pactiv Corp. has agreed to buy a majority interest in large Mexican thermoformer Central de Bolsas SA de CV, heightening its already-dominant position in thermoformed rigid packaging.
Lake Forest, Ill.-based Pactiv will pay $66 million to buy a 70 percent share in the Zapopan, Mexico, company, also known as Jaguar Corp. The agreement includes the right to purchase the rest of Jaguar's business at a future date.
The sale, scheduled to close in early October, will give Pactiv better reach into the Mexican market for disposable packaging products, said Pactiv spokewoman Lisa Foss. Jaguar thermoforms high-impact polystyrene for such products as cold cups and plates and has a foam packaging line.
The company also manages a small polyethylene bag business for the Mexican market, another product segment that fits with Pactiv's existing operations.
Jaguar recorded about $95 million in sales for the previous 12 months and works primarily from a two-plant, state-of-the-art manufacturing campus in Zapopan, near Guadalajara. In 2000, Jaguar claimed 40 percent of the Mexican market for plastic cups and plates.
In early 2000 the company totally rebuilt that manufacturing center after its existing facility was destroyed by fire. The two plants in Zapopan employ about 500.
The company also makes cups and plates at a site in Tiaxcala, Mexico, and has at least one other Mexican manufacturing facility, according to published reports. All together, Jaguar has 1,600 employees and 20 manufacturing and distribution centers scattered through Mexico, Foss said.
Richard Wambold, Pactiv chairman and chief executive officer, said in a Sept. 23 news release that the purchase gives the packaging company another source for new products that also can serve its U.S. customer base.
``Likewise, Jaguar's foam product line, which has been a key source of growth for the company, will benefit from Pactiv's proprietary manufacturing technology and know-how,'' Wambold said.
The Illinois company ranked first among thermoformers, according to Plastics News data, with $1.19 billion in North American sales for 2001. Pactiv has one other Mexican plant in Chihuahua that makes molded fibers, Foss said.
Packaging analyst Timothy Burns of Cranial Capital Inc. likened the Jaguar move to Pactiv's purchase earlier this year of Winkler Forming Inc., a Santa Fe Springs, Calif., thermoformer and extruder of food containers from amorphous PET. That deal also gave Pactiv better market reach in the western part of North America and expanded its offerings, Burns said.
Pactiv, also a leading producer of flexible packaging, previously has said that it wanted to expand its food products into Mexico, Burns said.
``Mexico offers Pactiv a good market for growth,'' said Burns, based in Solon, Ohio. ``They have already moved some manufacturing to Mexico to reduce costs.''
The introduction of HIPS cups and plates will fill a void in Pactiv's line of food-service and consumer products, many of which also are made from PS, Foss said. The high-impact material provides greater strength and durability for the disposable market, she said.
The company plans to use Jaguar's distribution centers in Mexico to bring more of Pactiv's product line to that country. The company is a market leader in consumer packaging with its Hefty-brand bags and makes a variety of packaging for food, building and protective products.