Scottish packaging producer and distributor Macfarlane Group plc has sold its U.S. and Mexican plastic foam packaging manufacturing operations to paperboard packaging maker Specialized Packaging Group Inc. of Hamden, Conn., for $7.7 million.
Glasgow-based Macfarlane said the decision to dispose of the businesses, comprising two plants in California and two in Mexico, is in line with its strategy to focus on its core labels and packaging distribution operations in Europe.
The businesses sold are Macfarlane Western Foam Packaging Products Inc., with plants in Union City and Ontario, Calif., and Macfarlane de México SA de CV of Zapopan, Mexico, near Guadalajara. The Mexico unit also has a facility in Tijuana that opened last year.
The operations design and produce foam packaging components and have seen some growth in the soft-fruit and medical packaging sectors.
Macfarlane acquired the U.S. operations in 1999 when it bought industrial film, containers and loose-fill polystyrene packaging producer Western Foam Packaging Products of Hayward, Calif., for $8.1 million.
The North American businesses achieved an operating profit of $369,000 on sales of $33.5 million in the year ended Dec. 31.
Macfarlane still has one plastics operation, an injection molding plant in Newtownmountkennedy, Ireland, that makes closures and dispensers for packaging powdered consumer products. The plant employs 70 and has 28 presses ranging from 40-500 metric tons of clamping force.
Macfarlane Group, which returned to profit in 2005 after four year of losing money, reported that its U.S./Mexico operations posted a loss in the first half of 2007, compared with a small profit in the same period of 2006. It blamed the poor results on weak demand and unfavorable market conditions.
In 2006, the Scottish group reported annual sales of $240 million. The company said it now plans to make acquisitions in its more profitable labels and distribution divisions.