Amcor Ltd. exited thin-wall container thermoforming with the recent sale of its Newport News, Va., operation.
Amcor sold the operation to Printpack Inc. of Atlanta, the fifth-largest film and sheet company in North America. An official said Printpack bought the thermoforming operation to expand its thin-wall business. Printpack also runs a container thermoforming operation in Williamsburg, Va.
The Aug. 29 Newport News sale follows by about six weeks Amcor's sale of its Regina, Saskatchewan, thin-wall container thermoforming business. Amcor sold the operations to focus on its core businesses, including PET containers, according to Paul Goodman, senior vice president of development and implementation for Amcor specialty packaging in North America.
The Regina operation was sold to Plastipak Industries Inc. of La Prairie, Quebec.
Plastipak President Normand Tanguay said in a telephone interview that the operation complements Plastipak's thin-wall injection molded container business that runs plants in La Prairie and in Toronto. Plastipak and the Regina-based business have competed in parts of the dairy container market and among distributors of thin-wall containers.
Tanguay estimated the Regina operation's annual sales at about C$25 million (US$18.3 million). It will boost Plastipak's sales total to about C$100 million (US$73 million) per year. The Regina plant's 125 employees will expand Plastipak's staff to more than 600. In addition to thin-wall containers, Plastipak runs a custom injection molding business in Brampton, Ontario. The firm bought its three injection molding facilities from Spartech Corp. in 2001.
Plastipak plans to keep the Regina plant open and might expand it after a business review, according to Tanguay. Regina now runs two sheet extrusion lines, seven thermoforming lines and five printing lines. The operation's 135,000-square-foot building is leased.
Regina processes exclusively polypropylene. Plastipak's container molding operations use PP and polyethylene.
Tanguay did not disclose the cost of the purchase, but he said it includes physical assets and trade-name rights. Gross value of the assets is about C$26 million (US$19 million).
The Regina plant was part of Amcor flexible packaging operations of Mississauga, Ontario. The two plants logged sales of US$40 million for the fiscal year ended June 30, 2002, according to Plastics News' most recent thermoforming survey.
Investment bank Aberdeen Gould of Toronto advised Plastipak on the Regina operation deal.
Amcor of Melbourne, Australia, became the world's largest PET blow molder last year when it bought Schmalbach-Lubeca AG of Ratingen, Germany. It subsequently decided to divest its majority stake in a North American closures business it acquired as part of Schmalbach-Lubeca. Amcor officials have said the firm wants to expand its PET container business. The Australian company recently agreed to buy seven Alcoa PET container plants in South America. An Amcor spokeswoman said governments are reviewing the purchase plan and Amcor expects to finalize the deal in 2003.