Australia-based Brambles Ltd., a global supplier of pallets and containers, has purchased Container and Pooling Solutions Inc., continuing Brambles' North American expansion into plastic bulk containers.
Buckhorn Inc. makes large, collapsible containers for CAPS, including shipping containers for handling dry goods and liquids. Buckhorn, based in Milford, Ohio, uses structural foam molding and injection molding to make the containers.
Brambles spent $16.4 million to buy CAPS, which has eight service centers in the U.S., Canada and Mexico. CAPS, based in Livonia, Mich., supplies bulk containers for automotive, food and beverage and other industrial uses.
Brambles CEO Tom Gorman said buying CAPS is an important step to strengthen the company's intermediate bulk container and automotive operations. Generally, those kinds of containers are used in a closed-loop network, where goods are shipped back and forth between points in the supply chain.
According to Brambles' 2010 annual report, it is establishing a global automotive container business.
Brambles and its Chep unit run pooling services for pallets and containers in 45 countries and own nearly 300 million wood and plastic pallets, and plastic transport containers. That includes 100 million pallets, mainly wood ones, in North America, said James Hall, director of investor relations and external communications for Sydney-based Brambles.
The company has been more aggressively introducing plastic pallets and containers in other parts of the world where plastic pallets are predominantly used by manufacturers to ship goods to retailers, which use them to display products in stores. That push to diversify Brambles' shipping products is coming to North America, he said.
“Our strategy is built around expanding our platform offering. Globally, and in the U.S. in particular, the Chep business is predominantly a pallet pooling business. And one thing we've articulated as a growth strategy is applying that pooling expertise to other platforms,” Hall said in a Feb. 9 telephone interview.
The CAPS deal follows Brambles' offer to buy IFCO Systems NV for $1.3 billion. Munich-based IFCO operates a pool of reusable plastic containers for fresh produce in Europe and the Americas, and owns a wood pallet recycling unit in the U.S. That proposed deal awaits regulatory approval.
In a presentation posted on Brambles' website, Gorman said one result of adding IFCO will be to increase Brambles' scale of returnable plastic containers, including “a strong position in the fast-growing RPC sector in the Americas.”
Chep Americas generated 2010 sales of $1.5 billion, covering North, Central and South America.
