CHICAGO — Phil Yates' business card now says Irving Place Capital instead of Graham Packaging, but some things haven't changed.
“The goal for any investor is the same,” Yates said at the 2015 Plastics Financial Summit. “To move from maturity to growth.”
The Plastics News-hosted event was held June 3 in Chicago. Yates was with York, Pa.-based packaging giant Graham for 34 years — including eight years as CEO — before joining Irving Place in 2006. In his time at Graham, the firm's annual sales grew from $1 million to $2.5 billion. Graham averaged 30 percent annual compounded growth for a 25-year period.
Graham's growth was made possible by partnering with private equity firm Blackstone Group. That partnership, Yates said, made Graham able to fund its capital needs. The firm grew through organic growth — pioneering the on-site model, where Graham collocated its packaging equipment with customers — and through acquisitions.
Graham's first on-site operation was with an anti-freeze customer, and the model later spread to drinkable yogurt and many other products. Today, one-third of all Graham plants are on-site operations, with those operations generating half of the firm's sales. Graham currently ranks as North America's largest blow molder, according to a recent Plastics News ranking.
Major brands that Graham has worked with over the years include Unilever's Wisk and Procter & Gamble's Tide laundry detergents, as well as Quaker State motor oil and Tropicana orange juice. In 2011, Graham was acquired by Australian packaging giant Reynolds Group Holdings Ltd. for $4.5 billion. Blackstone had taken Graham public in 2010.
Yates credited Blackstone with allowing Graham to pursue opportunities in juices and drinks.
“Private equity has become a major player in the plastics packaging world,” he said. “It can offer capital to fund growth and access to additional talent.”
New York-based Irving Place has been active as well, making 18 packaging acquisitions — in plastics and other materials — since 2004. Rigid packaging firm Mold-Rite Plastics LLC has averaged 23 percent compounded annual growth since being acquired by Irving Place in 2010.
Even more than 40 years after joining Graham — after being sold on plastics by company founder Donald Graham at a cocktail party — Yates is enthusiastic about the field.
“I continue to think there's a great future in plastics,” he said.