Portola Packaging Inc. is shutting down its cosmetics packaging arm, Portola Tech International, and ending production at facilities in Cumberland, R. I., and Nanhai, China.
The closures will allow Portola to focus on its core beverage closure and bottle business, the company said in a June 29 news release.
The Portola Tech division designs and manufactures specialty jars and closures for the cosmetics and personal-care industries. It formed in 2003, when Portola Packaging purchased Tech Industries Inc. of Woonsocket, R.I.
In 2009, Portola Tech moved its headquarters and U.S. manufacturing plant to Cumberland. The Nanhai plant opened in late 2010.
Portola said it will close the plants by the end of August, and will liquidate business assets, including injection molding and vacuum metalizing machines and other equipment, by the end of the year.
Portola employs 225 workers across both facilities, Chief Financial Officer Glenn Fish said in a June 29 telephone interview.
According to a Worker Adjustment and Retraining Notification Act notice filed with the state, 51 workers will be affected by the Cumberland plant closure.
Portola Tech closed its facility in Shanghai late last year. A plant in Louny, Czech Republic, had housed some cosmetics operations, but will now focus on manufacturing caps and closures, Fish said.
Portola Packaging said its beverage closure volume has grown annually by double-digit percentages over the last three years.
The company is known for manufacturing tamper-evident closures for non-carbonated beverages. Portola's proprietary manufacturing processes and other cost advantages have helped the closures division flourish, Fish said. He added that the company will take advantage of new opportunities in that area.
“We'll continue to compete and invest in the tamper-evident closure space and further strengthen our position,” he said.
The cosmetics division makes up less than 10 percent of Portola's total global sales, according to Fish.
In recent years, Portola has focused on business units where it has a competitive advantage, he said, adding that in 2010, the company closed its equipment division.
Portola Tech's restructuring efforts, including buying the Nanhai and Cumberland plants, were decisions made by a previous management team, Fish said.
In 2008, Portola emerged from pre-packaged Chapter 11 bankruptcy.
Naperville, Ill.-based Portola will now operate at 10 manufacturing facilities — three in the U.S., three in Canada, and at plants in Mexico, England, New Zealand and Czech Republic.
Portola ranked No. 30 in Plastics News' most recent survey of North American injection molders. The company had estimated total sales of $310 million in 2011.