British Vita plc has been trimmed and restructured to make it a leaner performer, since U.S. venture capital firm Texas Pacific Group of Fort Worth, Texas, acquired it two years ago.
British Vita, an Accrington, England-based maker of sheet, compounds and foam products, has been trying to offset significant resin price inflation since the TPG takeover by improving productivity, increasing sales and reformulating materials.
Despite the cutbacks, Vita continues to expand its business, and its capital investment in 2007 is due to double.
``It's not easy, but we are getting there. We are investing in the company and looking at growing it,'' said Nigel Hay, chief executive officer of Vita's compounding unit, at a recent news conference in London.
One business enjoying the recent investment is the firm's extruded sheet subsidiary, Vitasheet. With some 100 extrusion lines at eight European plants and annual sales of 250 million euros ($337 million), Vitasheet opened a new central, 1 million euro ($1.34 million) research and development center in Jlich, Germany, in April.
After closing two sites at the end of 2006 - its VTS Doeflex plant in Redhill, England, and a Royalite Plastics srl plant in Caleppio, Italy - Vitasheet has improved its cost competitiveness.
``We're now in a good position to respond to the migration of our customers into Eastern Europe and, in some cases, to Asia,'' Vitasheet Managing Director Rob Harris said at the conference.
But, he stressed, 80 percent of the firm's future growth will come from its traditional, more mature market in Western Europe.
Looking forward to Europe's major industry showcase in October, the K 2007 trade show in Dusseldorf, Germany, Vitasheet plans to unveil new products for the biodegradables, transport, household products and construction markets, according to the firm's head of product development, Graeme Smith.
Vita Compounding, part of the company's industrial polymers division, also has seen recent investment. The compounding unit has annual sales of 360 million euros ($486 million) and 21 operations in Europe, Australia, Asia and North America.
In late 2006, the group spent nearly 4 million euros ($5.4 million) on a fourth compounding extrusion line and clean technology at VTC Elastoteknik AB in AmÃ¥l, Sweden. That 8.8 million-pound-per-year Berstorff line, producing thermoplastic elastomer compounds, will serve mainly the expanding market for medical devices.
``We have seen great interest in TPEs as alternatives to PVC. There are a lot of medical projects coming up and the group made a major investment in Sweden,'' said Per G. Hellberg, VTC TPE Group's managing director.
The Swedish plant is selling material directly to China, where some medical customers are building up device production lines, he said. Vita also is developing a special hydrophilic TPE, a ``water swellable'' compound, being used in construction profiles, which absorbs dampness to prevent leaks. There is limited commercial production of the material and extruded profiles are being tested on a half-mile trial area, Hellberg said.
Another Vita Compounding business, Warrington, England-based Perrite Ltd., has established VTC Malaysia with a compounding plant in Johor. It is a major supplier to Dyson Appliances Ltd., which makes vacuum cleaners in Malaysia. Perrite technical manager Brendan Devlin estimated his firm supplies Dyson with roughly 169 grades of materials.
Other Vita restructuring steps have included launching four new plants in Eastern Europe, and closing a plant in Maesteg, Wales.
Vita generates 1.6 billion euros (US$2.16 billion ) in annual sales.