UPDATED — Charter NEX Films Inc. will soon have a new owner: private equity firm Pamplona Capital Management LLP.
Charter NEX, based in Milton, Wis., runs blown plastic film operations in its headquarters town, and in Rhinelander and Superior, Wis., and Turners Falls, Mass.
Pamplona was attracted to Charter NEX's high growth in key categories, including stand-up pouches, Pamplona stated in a Dec. 29 news release. Also attractive are Charter NEX's quality standards and manufacturing performance, the investment firm noted.
Charter CEO Kathy Bolhous said in a Dec. 30 phone interview that greater capital availability from the new owner will help her company grow.
“We anticipate making significant investments and capacity additions,” Bolhous predicted. Acquisitions are also possible, she added.
Charter NEX has been expanding internally. It invested about $2 million to double the space of its Milton facility in 2014, about a year after it installed two new Windmoeller & Hoelscher three-layer blown film lines there. In Turner Falls, it installed an additional new extrusion line, also a W&H system, in 2014. Currently Charter NEX runs 31 blown film lines in its four plants.
Bolhous said Charter NEX has two blown films on order to continue the expansion. Due to be installed in 2015 are a W&H three-layer line for Milton and a seven-layer Brampton Engineering line for Rhinelander.
“We believe there are significant opportunities to continue this growth both organically and through acquisitions and we are excited to be part of the business,” stated Martin Schwab, the Pamplona partner who led negotiations.
“Pamplona will work with management to accelerate the company's growth ambitions by providing long-term financial and strategic support.”
Pamplona is based in London and New York. It does not list any plastics company in its portfolio. The diverse equity company includes healthcare, pharmaceuticals and heavy equipment among its investments. It expects to complete the Charter NEX acquisition in the first quarter of 2015.
Charter NEX has been owned by private equity firm Mason Wells of Milwaukee.
Charter NEX was formed in late 2012 by the merger of NEX Performance Films Inc. and Charter Films Inc. Bolhous said Charter NEX's sales last year were about $250 million and she expects it to come in about $285 million in 2014. Total employment is about 350.
“We have worked hard over a number of years to become an industry leader in specialty film products,” Bolhous said.
Charter NEX produces monolayer, coextruded and barrier films from polyethylene, nylon and ethylene vinyl alcohol. Food and beverage, consumer products and medical are its main markets. Bolhous said the company can extrude up to nine layers.
Houlihan Lokey Capital Inc. advised Charter NEX in the deal. Morgan Stanley & Co. LLC advised Pamplona.