Tetra Pak has agreed to sell four ``through-the-wall'' blow molding plants to Graham Packaging Co. LP in a deal that gives Graham more on-site manufacturing with customers.
The March 10 agreement for undisclosed terms provides York, Pa.-based Graham with new sites in Brazil, Belgium and Turkey, and a collocated plant with a milk producer in Joplin, Mo., Tetra Pak said. The four sites had sales last year of $21 million, Graham said in a news release.
The extrusion blow molding operations are in or near customers' filling plants. The plants use a conveyor system to feed customers' plants, sometimes through a wall opening. The concept saves on transportation costs and allows close design interaction with customers.
Lausanne, Switzerland-based Tetra Pak decided last year that the operation did not mesh with its core paperboard packaging and equipment business, said spokesman JÃ¶rgen Haglind. The company also makes PET bottles, and last year, Tetra Pak's parent, Pully, Switzerland-based Tetra Laval SA, bought PET bottle machinery maker Groupe Sidel.
``Hole-through-the-wall became an odd part of Tetra Pak,'' Haglind said. ``We couldn't see how, in the long term, it could add any value to customers in our business.''
The operations match Graham much better, Haglind said. Graham is North America's largest maker of HDPE bottles and prefers to collocate on customer sites. Graham spokesman Mark Leiden agreed, saying the acquisition ``hits the company's sweet spot.''
The Missouri and Brazil facilities each produce 250 million bottles a year, while the smaller sites in Belgium and Turkey supply about 30 million bottles annually, Haglind said. The firm did not divulge the city locations of the foreign plants due to confidentiality agreements with customers.
The Missouri operation is on the site of co-packer Jasper Products LLC, a maker of unrefrigerated, flavored milk and soy products. The companies developed an 11-ounce milk bottle used by Bravo! Foods International Corp., that features Looney Tunes cartoon characters.
Graham suddenly has become a larger player in acquisitions. Last year it almost doubled in size after buying most of the blow molding business of Toledo, Ohio-based Owens-Illinois Inc. The purchase was the first acquisition for the firm in its history.
Including the O-I business, Graham recorded about $2.1 billion in sales last year. It is majority-owned by New York equity firm Blackstone Group.
Tetra Pak has divested three other through-the-wall plants. Its four remaining facilities are on the market in Canada, the United Kingdom and France, Haglind said.