Pretium sets its sights on growth; seeks more acquisitions

Rigid plastic container and closure manufacturer Pretium Packaging LLC of Chesterfield, Mo., is growing rapidly through an ongoing series of acquisitions and product developments.

Parent company Genstar Capital LLC likes plastics' promise.

“We are pretty bullish on plastic converters such as Pretium,” said David Golde, a director with equity investor Genstar in San Francisco and chairman of the board at Pretium.

Golde noted that consumer product companies are customizing packaging to drive sales and shelf-differentiation for various grocers and retailers.

“Pretium has a strong engineering capability to innovate design,” Golde said in a telephone conference call. “At Genstar, we provide an unparalleled amount of support for where a management team wants to take a business.” Golde focuses on Genstar's industrial and health care verticals.

While withholding numbers, Golde noted: “We are aggressively investing in the business to support growth.”

Paul Kayser joined Pretium as president and CEO in February.

“We are not done buying at all,” Kayser said. “Inside Pretium, we have a team to focus on identifying targets, typically with only a few locations.”

Tim Wehrfritz is Pretium senior vice president for mergers, acquisitions and integration.

Kayser noted that Pretium has a broad portfolio of preform designs and a strong capability to provide innovative solutions to customers for specific applications.

“Over the years, the company was assembled from some great names in the blow molding industry” and operates with a unique culture that aims to maintain local responsiveness as a key element, Kayser said.

“Customers can no longer afford to have large inventories or large transactional commitments,” Kayser said. “A customer wants containers on a specific date at a specific cost” for use in a particular filling location that may be 200 to 600 miles — or across the country — from the relevant Pretium production site.

Wehrfritz and other members of Pretium's geographically dispersed merger-analysis team may meet with a strategic blow molder's principal owners and explore operational synergies, possible exit strategies and personal preferences of a family or individual wanting to retire.

“With Genstar's backing, we are going to accelerate our ability to buy and merge teams into Pretium,” Kayser said. “From our last three acquisitions, we have retained all of the senior management teams.”

That includes Bill McNeal and Joe Abbott from Escondido, Calif.-based Tri-Pack Enterprises Inc. doing business as Custom Blow Molding. In July, Pretium acquired CBM and retained McNeal, who was CBM president and CEO, and Abbott, who was executive vice president.

The two men “built a great business in a short amount of time,” Kayser said.

CBM's sports nutrition and supplement packaging specialty is a “fast growing market, and we got additional nodes in our network to get closer to our customers,” Kayser said.

Kayser said CBM's footprint complements that of Pretium.

CBM's Escondido facility is “close to our Anaheim [Calif.] location” strengthening Pretium's West Coast presence.

CBM's Carrollton, Texas, site is seen as important for Pretium customers, particularly in the food and industrial chemical markets.

And CBM's Aurora, Ill., operation enhances Pretium's Midwest operations in downstate Illinois. From Aurora, Pretium's existing Peru plant is about 50 miles southwest and the Pretium Paris plant is about 160 miles southeast.

Peru does single-stage PET containers and preforms for food and specialty beverages. Paris manufactures the bulk of Pretium preforms and makes stretch blow molded bottles.

Pretium is retaining the CBM brand for the sports nutrition business. “CBM had a specific meaning to customers,” Kayser said. That realization gave him an epiphany moment.

Now, Pretium is assessing how to best integrate other in-house product-line identities to which customers refer. “Do we establish specific brands as part of a holistic packaging strategy?” he pondered.

Previously, Pretium added Intertech Corp. of Greensboro, N.C., in February 2015 and Tri-Delta Plastics of Hillsborough, N.J., in December 2014.

Reflecting CBM's specialty, Pretium has established a fourth product category for sports nutrition and supplements. The other three categories focus on the food and specialty beverage, household and industrial chemicals and health beauty markets.

Kayser aims to organize operations around regional leadership and, as much as possible, provide service to customers locally.

Now, in addition to its Chesterfield headquarters offices, Pretium has 15 manufacturing locations with 14 in the U.S. and one in Canada in the Saint-Laurent borough of Montreal.

Pretium employs 1,500, blow molds 2 billion containers per year and operates 205 blow molding machines for injection blow, extrusion blow and stretch blow molding applications.

In addition, for closures and preforms, Pretium operates 29 injection molding machines with clamping forces of 125-350 tons.

Pretium with an estimated $285 million in sales ranked 15th in the 2015 Plastics News list of North American blow molders.

Genstar acquired Pretium from Castle Harlan Inc. of New York and Nicolet Capital Partners LLC of Chicago in June 2014.