Media and printing major Transcontinental Inc. has expanded its entrance into flexible plastic packaging with another acquisition.
The Montreal-based company announced Oct. 1 that it bought Ultra Flex Packaging Corp. of New York, a $72 million company that buys plastic film and sheet and converts them into flexible packaging, bags and pouches. The purchase follows Transcontinental's first foray into flexible packaging in early 2014 when it acquired Capri Packaging of Clinton, Mo.
Ultra Flex has 10-color flexographic printing capability and also does extrusion coating and laminating. It employs about 300. Transcontinental plans to continue the operations in the New York borough of Brooklyn.
“Our objective is to build a network of facilities,” a spokeswoman noted in an email correspondence.
Transcontinental announced Sept. 1 that it agreed to pay US$80 million for Ultra Flex. The Montreal company earlier gave notice it is diversifying to ensure future growth. Its biggest businesses have been digital and print media and publishing. Its sales for the third quarter, which ended July 31, were about C$482 million (US$361.5 million), up marginally from a year earlier. Based on Capri's annual sales of about US$72 million when Transcontinental bought it and the revenue of Ultra Flex, Transcontinental's flexible packaging business now represents about 10 percent of the company's total sales. It remains Canada's largest printer.
“We found Ultra Flex to be a compelling acquisition for us because it expands our footprint in the U.S., gives us access to a national sales force, to new vertical markets and manufacturing capabilities,” spokeswoman Jennifer McCaughey noted in an email. Capri has logged higher sales since the acquisition, “surpassing our expectations,” she added.
Ultra Flex was established in 1974. Transcontinental President and CEO François Olivier said in a news release that it is a “solid business.”