Consumer packaging giant Rexam plc expects to almost double its plastic packaging business in the next few years, but without building additional capacity in the U.S.
``We expect to grow by more than 20 percent annually,'' Patrice Lewko, marketing director of Rexam Pharma, said in an interview June 7 at the Medical Design and Manufacturing Show East in New York.
``We see a big expansion in the next couple of years'' that will increase sales from plastics packaging to $2 billion, making it one-third of the company's sales. Plastics currently accounts for roughly 20 percent, or $1.1 billion, of the company's $5.6 billion in sales.
London-based Rexam has moved in plastics packaging rather quickly in the past three years through a series of acquisitions, including the purchases last fall of packaging molder Precise Technology Inc. of North Versailles, Pa., and Delta Plastics Inc. of Hot Springs, Ark.
``We are still looking for acquisitions worldwide. We see the plastics activity [throughout the company] expanding significantly in the future as we pursue internal growth and external acquisitions,'' said Lewko, who is based in the Paris headquarters of Rex Pharma, which now includes the medical packaging injection molding business of Precise.
Rexam shuttered four of Precise's U.S. medical product plants, dislocating some 180 workers, but kept ones in Buffalo Grove and Wheeling, Ill.; and West Lafayette, Ind. Rex Pharma also has three plants in France and one in Germany.
Lewco said Precise, acquired six months ago, is about 75 percent integrated into Rexam, giving the company strong bases in the U.S and Europe.
``Rex Pharma was established in Europe and China, but we needed to be in the United States because it is a key market'' and to get into the drug-delivery segment of plastics packaging, he said.
At the show, Rexam also said it will integrate relevant segments of Precise into the newly formed Rexam Health and Personal Care division in Pittsburgh.
``We expect we now will be able to sell more of our stock [plastic] products like retail pumps and nasal sprays in the U.S.,'' Lewko said. That was the larger portion of Precise's manufacturing base, with seven plants in the U.S., one in the Netherlands and one under construction in Poland.
Lewko said Rexam plans to increase automation in the former Precise plants and boost Six Sigma and value-stream mapping efforts to ``improve manufacturing productivity.''
Rexam employs 23,000 in 20 countries. It is the world's leading beverage can maker and among the top five consumer packaging companies globally, with annual sales of $5.6 billion in 2005.