Command Packaging is acquiring Diamond Polyethylene Products Inc. in a combination of plastic bag manufacturers.
Ownership will be transferred Feb. 1, although the purchase agreement was completed weeks ago. Terms were not disclosed.
Diamond's Skip Nevell, a longtime influence in the extrusion, converting and printing markets, will retire after a period of business transition.
By the end of April, Command intends to close Diamond's 25,000-square-foot site in Los Angeles and move some equipment several miles to Command's 170,000-square-foot facility in Vernon, Calif.
Command is investing about $1.5 million for two coextrusion machines and three bag-making units to upgrade for Diamond's product lines. The new equipment, which should be operating by March 31, should improve efficiency and cut operating costs, said Command President Pete Grande. Diamond has four in-line extrusion lines.
The privately held firms have similar customer bases in parallel market niches. Command concentrates on value-oriented retail and restaurant carryout accounts and extends its reach with the acquisition. Diamond focuses on higher-end applications.
Command uses high density polyethylene for most products while Diamond processes low density PE for garment rolls and patch-handle, draw-tape and some litter bags.
Command is hiring about 25 of Diamond's 35 employees.
Herbert Nevell was serving as a manufacturers' representative in 1960 when he and his son, Skip, established Diamond Polyethylene. While selling the business, Skip Nevell retains ownership of the current Diamond building.
Grande and a partner, Albert Halimi, founded Command Packaging in 1989. They began augmenting domestic production with imports beginning in 1991 and acquired the Vernon site in 1995. Halimi is Command's executive vice president and chief operating officer. Command employs 160 and operates 14 extrusion lines, 19 bag machines and seven roll-to-roll printing presses. Command also has two central impression printing presses, one eight-color and one six-color.
Command's lone LDPE product line is the nonreinforced, die-cut-handle Super Gloss bag. The line, introduced for high-end markets in 1997, has grown at the expense of older-style bags including those with patch handles.
Command operates an importing division that accounts for about 20 percent of the firm's sales. The company imports the bags, especially those requiring hand labor, from manufacturers in China, Thailand and Vietnam.