Protective packaging manufacturer Pregis Corp. has purchased foam extruder Inter-Pac Inc.
The acquisition will make Pregis the largest producer of polyethylene foam sheet in the U.S., according to the Deerfield, Ill.-based company.
Inter-Pac, based in Tupelo, Miss., makes PE foam for protective packaging, industrial and consumer applications. Pregis will continue to operate Inter-Pac's 180,000-square-foot manufacturing plant, which includes three foam extrusion lines and laminating technology, and will retain the company's 25 employees.
Pregis would not disclose terms of the deal.
The acquisition will boost Pregis' capacity, make better use of its footprint and get it closer to its East Coast customers, said Kevin Baudhuin, president and CEO, by phone.
“It's really people, equipment and location that made this a solid acquisition,” he said.
The Tupelo plant will serve customers in several markets, including furniture, flooring, electronics and industrial distribution. The acquisition also will allow Pregis to bring its broad product range to existing Inter-Pac customers, Baudhuin said.
The acquisition supports Pregis' growth strategy. The company is focused on growing both its core business — foam, bubble-style wrap and mailers — and its systems business, which includes air pillows and foam-in-place systems, he said.
Pregis has divested several non-core operating units during the last year.
Last year, Pregis sold Kobusch-Sengewald, its Warburg, Germany-based specialized packaging business, to Sun European Partners LLP for $160 million. Pregis also sold its paper packaging unit Hexacomb to Boise Inc. for $125 million.
In January, Pregis sold its United Kingdom distributor Ambassador Packaging to Antalis International for an undisclosed sum.
Pregis makes protective packaging for a variety of markets, including food, beverage, health care, medical devices, agricultural, e-commerce, retail, automotive, furniture, electronics, construction, military and aerospace.
Not including the Tupelo facility, Pregis operates 25 facilities in 10 countries throughout North America and Europe. It has 2,000 employees worldwide.
The company had an estimated $200 million in North American film and sheet sales in 2011, according to Plastics News' most recent survey of the industry.
Pregis' protective packaging business had approximately $500 million in sales, Baudhuin said.