Irish molder One51 enters North American market with IPL acquisition

Irish environmental and injection molding company One51 plc is entering the North American market through the acquisition of the majority of IPL Inc., a custom and proprietary molder based in St. Damien, Quebec.

One51 of Dublin and its several plastics subsidiaries have not been active in North America, so the purchase is an extension of One51's geographic reach, explained One51 CEO Alan Walsh in a phone interview. The two companies overlap in some product areas such as wheeled waste and recycling carts, but IPL's retail packaging business, in the 250-millimeter to 2.5-liter size range, would be a new market for One51.

“IPL gives us access to significant new markets for our existing products while also allowing us to bring a wide range of exciting new products, especially in food packaging and bulk containers, to our existing customers,” Walsh explained.

Walsh said IPL's manufacturing expertise is impressive, “but we can make some improvements from an operational perspective.”

IPL will operate as a stand-alone business but One51 will appoint new executive management after the transition period.

Under One51's ownership, IPL could boost its use of recycled plastics in its carts, a notable thrust of the United Kingdom operations, Walsh added.

The Irish company's plastics businesses are under the OnePlastics Group umbrella. Its other operating division is ClearCircle, a hazardous waste management and recycling operation.  One51 also holds investments in renewable energy such as wind turbines. In total, One51 logged sales of 276.5 million euros ($304.2 million) last year, 10.2 percent higher than in 2013.

OnePlastics Group has annual sales of about 150 million euros ($165 million), employs about 450 and runs six manufacturing locations: four in the United Kingdom, one in Ireland and one in China. The group has a stable of more than 150 injection molding machines, including all-electric models for food and health care packaging. IPL operates more than 80 injection molding presses.

In OnePlastics Group is MGB Plastics of Rotherham, England, which One51 says is the largest plastic wheeled bins manufacturer in the United Kingdom, with capacity to mold 1.5 million wheeled bins a year. The Protech Plastics subsidiary molds rigid containers such as paint cans in Staffordshire, England. Protech Performance Plastics is a diverse custom molder mainly supplying the electronics industry from plants in the U.K. and China. It also has a Boston office. The Straight Ltd., subsidiary in Hull, England, molds wheeled bins and curbside bins for recycling and waste. One51 bought Straight last year. Also part of the group is AAC Technology, a toolmaker specializing in auto markets.

IPL, with plants in St. Damien; Edmundston, New Brunswick; and Lee's Summit, Mo., employs about 800 and had sales of C$215.2 million (US$172.2 million) last year, and earnings before interest, taxes and depreciation of C$30.9 million (US$24.7 million).

One51 predicts IPL sales will reach C$240 million (US$192 million) in 2015 and EBITDA should climb to C$40 million (US$32 million).

IPL molds more than 400 products for packaging, materials handling and environmental markets. Its sole U.S. plant, called Plastic Enterprises Co., mainly molds plastic and paper lids for food applications, such as ice cream tubs and coffee cans. Its biggest customer is Kellogg Co., for which the Missouri operation molds about a billion plastic lids a year.

IPL in May won a Diamond Award in DuPont's annual packaging innovation contest for its polypropylene SkinnyPack food container that combines a flexible in-mold label with a rigid frame and uses 55 percent less plastic than its predecessor.

One51 said at its May annual meeting that it will focus on OnePlastics and ClearCircle while “continuing to unlock value in our [renewable energy] investment portfolio.”

IPL's purchase price amounts to about C$280 million (US$224 million). One51 will pay about C$90 million (US$72 million) for its 67 percent stake. Bank financing represents about C$100 million (US$80 million) in the deal. Institutional investor Caisse de dépôt et de placement du Quebec and provincial development capital fund Fonds de Solidarité also bought shares, and hold 22 percent and 11 percent stakes, respectively.

Novacap Investments Inc. was IPL's majority shareholder with 70 percent of shares. It has been the dominant shareholder since 2010, when the Metivier family and IPL management sold the business.