Cie. de Saint-Gobain SA has agreed to sell its Calmar Inc. injection molding unit for $710 million in cash to Stamford, Conn.-based packaging firm MeadWestvaco Corp. The deal is set to close by the end of June.
MeadWestvaco will keep the operations and management intact, a spokeswoman said in an April 27 telephone interview.
The deal gives MeadWestvaco ``a more comprehensive array'' of packaging offerings, said John Luke, MeadWestvaco's chairman and chief executive officer, in a news release.
Calmar's global presence also attracted MeadWestvaco because it strengthens the company's world footprint with facilities in Brazil, Colombia, Peru and several European countries, said Mark Weintraub, an equity analyst with Buckingham Research Group Inc. in New York.
In addition, MeadWestvaco is strengthening its product line with customized pump and spray packaging products, Weintraub said. Officials also are building the firm on the belief that customers want one-stop shopping.
MeadWestvaco's core business has been paperboard, but it's been expanding beyond that, officials said in the firm's 2005 annual report. The company's long-term plan is to focus on packaging, expanding and strengthening itself in design and packaging.
In 2005, the company divested its printing and writing papers businesses. The firm also followed the trend of other packaging players by setting up the Packaging Innovation Center at North Carolina State University in Raleigh, N.C.
The Calmar buy gives MeadWestvaco strength in high-growth emerging markets, Luke said.
MeadWestvaco already has some holdings in plastics packaging under its AGI Polymatrix unit, which injection molds packaging for DVDs. In 2003, it invested $25 million to open a plant in Elizabethtown, Ky., where it began with 11 production cells.
The company also operates an injection molding plant in Pittsfield, Mass., under AGI Polymatrix, said spokeswoman Alison von Puschendorf.
Earlier this month, AGI introduced its NatureSource Visual Packaging, plastic folding cartons made from NatureWorks polylactide, which the company is touting as North America's first commercially viable, high-performance plastic carton made from PLA.
The company is marketing it for use in visual packaging applications, including cosmetics, personal-care and liquor products.
Calmar operates North American injection molding plants in its headquarters city of Grandview, Mo.; Washington Court House, Ohio; Winfield, Kan.; and San Luis Potos¡, Mexico. According to a Plastics News' 2006 ranking, the firm had estimated North American injection molding sales of $195 million. It had nearly $420 million in total global sales during the previous 12 months, according to MeadWestvaco.
Under Saint-Gobain, Calmar was boosting its European footprint. It acquired injection molder Microspray Delta SpA of Milan, Italy, in September in a deal that made Calmar the second-largest European producer of pumps for the fragrance industry, officials said at the time.
The transaction gave Calmar three injection molding plants in Europe: in Barcelona, Spain; Hemer, Germany; and Milan.
MeadWestvaco had 2005 annual sales of more than $6 billion. According to its Web site, $4.4 billion of that amount was in packaging, $1.1 billion in consumer and office products and $400 million in specialty chemicals. By the end of the year, it will relocate its headquarters to Richmond, Va.