In the second half of 2023, plastics M&A activity was led by Greif Inc.'s spending spree in the jerrycan market.
Greif of Delaware, Ohio, added to its blow molded container manufacturing footprint with the acquisition of Reliance Products Ltd., a single-site operation in Canada. Reliance makes barrier and conventional blow molded jerrycans and other containers for the agricultural, chemical and consumer water markets.
Bodtker Group of Cos. Ltd. of Calgary owned Reliance for a decade after acquiring the operation from a group of five investors in 2013. Reliance uses in-mold fluorination to create a barrier for high density polyethylene containers serving the crop protection and industrial chemicals markets.
Greif did not reveal a purchase price but indicated the all-cash transaction "reflects approximately 6.75x pro forma adjusted EBITDA [earnings before interest, taxes, depreciation and amortization]."
Greif followed that up by spending $538 million to acquire iPackChem of Paris.
"The iPackChem portfolio is in perfect alignment with Greif's strategic growth aspirations in jerrycans and other small plastics," CEO Ole Rosgaard said in a statement. "Its state-of-the-art facilities are located in many of the regions we already serve, leading to significant value creation opportunities."
IPackChem adds 13 locations in eight countries, along with 1,400 employees, to Greif. Sales for the 12 months ending Sept. 30, 2023, were $235 million and adjusted EBITDA were $57 million. The sale price represents a 9.4 times adjusted EBITDA.
The purchase by Greif ends a string of private equity owners for iPackChem, which was last sold in 2021 to private equity firm SK Capital Partners LP by French private equity firm Sagard Holdings ULC.
In other notable second-half deals:
• Houston-based material science and component maker Evantic acquired Plastic Distributors & Fabricators LLC. Evantic is owned by Cleveland-based private equity firm Edgewater Capital Partners. The deal marks its fourth acquisition in the advanced materials and design engineered components space.
"PDF brings additional strong customer relationships, manufacturing know-how from prototype to serial production and strategic geographic presence to the Evantic family of brands," Sarita Gavhane, principal at Edgewater Capital Partners, said after the deal. "We are … actively looking for ways to build around [PDF's] current team to better support them."
Edgewater got into the performance materials business in 2021, when it bought the Technetics polymer components business from EnPro Industries, which it renamed Altamira Material Solutions. Also in 2021, Edgewater bought Precision Fluorocarbon Industries. Edgewater combined AMS and PFI in November 2022 and renamed the company Evantic.
PDF makes dimensionally complex parts, including covers, frames, housings and other structural components, in the life sciences, semiconductor, aerospace, defense and clean energy markets. Evantic makes engineered components for the semiconductor, aerospace, energy and industrial sectors.
• Indian automotive supplier Samvardhana Motherson International agreed to acquire Kronach, Germany-based Dr. Schneider Group, which makes plastic interior components for vehicles, including surfaces and lighting modules, for $131.6 million. Dr. Schneider Group filed for insolvency in September 2022 due to "an unsuccessful operational and financial restructuring."
Dr. Schneider Group makes integrated electronic interior polymer components and systems, air vents and decorative interior components. It employs about 4,500 people in seven facilities in Germany, Spain, Poland, China and Russell Springs, Ky.
• Auburn, Ala.-based medical startup SiO2 Materials Science emerged from Chapter 11 bankruptcy with Oaktree Capital Management LP acquiring the company.
Amid the COVID-19 pandemic, SiO2 rapidly expanded with a $163 million investment in 2020 to meet increased demand for testing supplies, according to Ken Kelly, chief operations officer at SiO2.
"As those volumes tapered away … we had to go back to our core [materials science] business with the primary drug containers," including vials, syringes, blood tubes and transport tubes for the diagnostic market, Kelly said. "We had overextended ourselves." The injection molder filed for Chapter 11 protection on March 29, 2023, and emerged on Aug. 1, he said.
• Toronto-based ABC Technologies Holdings Inc. acquired the automotive business of Plastikon Industries for $130 million. The business, which supplies automotive interiors, assemblies and electric vehicle battery housings, renamed it Plastikon Automotive.
The deal includes facilities in Hayward, Calif.; Austin, Texas; and Leitchfield, Ky. "The pending acquisition will not impact the daily roles and responsibilities of Plastikon Automotive's 900 employees," Tom Hajkus, global communications manager of ABC Technologies, said via email.
• Tredegar Corp. divested its Flexible Packaging Films division to Oben Group in a $116 million deal. The operations, operating under the Terphane name, includes locations in Bloomfield, N.Y., and Cabo de Santo Agostinho, Brazil, with its headquarters in São Paulo.
Tredegar anticipates clearing $85 million after deduction of withholding taxes, escrow funds, capital gains taxes and transaction costs. The Terphane business, which makes biaxially oriented PET (BOPET) films, had sales of $152 million and earnings of $16.4 million for the 12 months ending June 30, 2023.
Lima, Peru-based Oben makes PP, polyester and nylon films used for flexible packaging and coated films for the graphic industry. The company also manufactures thermoformed polypropylene products.
• Private equity firm The Jordan Co. (TJC) moved deeper into plastics with the acquisition of Soteria Flexibles Holdings LLC, a short-run, custom flexible packaging maker. Paris-based Ardian, also a private equity firm, sold Soteria after four years of ownership through the company's North American Fund.
Ardian created Soteria after the 2019 purchase of Colonial Bag Corp., a family-owned company based in Carol Stream, Ill. Along the way, the company added other flexible packaging companies: RediBag Inc. of Tukwila, Wash.; Continental Products of Mexico, Mo.; and Film Tech LLC of Stanley, Wis. Those firms continue to operate under their own names.
Soteria provides flexible packaging to a wide range of end markets including health care, fresh food, industrial and foodservice. TJC's holdings also include Spartech LLC — a maker of engineered thermoplastics and custom packaging with 17 plants in the United States — and rigid packaging maker Anchor Packaging LLC based in St. Louis.
• Rock West Composites Inc. acquired the assets of Performance Plastics Inc. for an undisclosed price. In a news release, officials with RWC in West Jordan, Utah, said the deal will expand the firm's product offering into complementary markets that have little overlap with its existing businesses but that use similar materials and processes.
Soon after the deal, RWC announced the closing of PPI's 80-employee, 50,000-square-foot location in San Diego. RWC employs 280 in 275,000 square feet of manufacturing space. The firm recently expanded its operations in Salt Lake City.
In an Oct. 4 letter to employees, PPI officials said the firm "has been struggling to remain solvent and will be permanently closing as a business." They added that the sale to RWC was made "so that [the firm's] debtors could be paid off and avoid bankruptcy."
RWC is offering employment to all PPI employees. RWC is based in West Jordan and operates plants in San Diego, Salt Lake City and Tijuana, Mexico.
• Plaskolite LLC acquired the Vycom sheet business of Azek Co. Inc. for $140 million. Officials with Plaskolite in Columbus, Ohio, said that with the acquisition, their firm "will expand into attractive new substrates and provide a broader product bundle to a complementary customer base."
Vycom, based in Scranton, Pa., makes highly engineered olefin and PVC sheet for semiconductor, outdoor living, playground, marine, industrial and graphics markets.
Vycom recycles and reuses 99 percent of its scrap, which will expand Plaskolite's involvement in sustainability. The all-cash deal broadens Plaskolite's substrate offering and expands its presence into other market segments, according to Thomas Chadwick, principal of manufactured products at Plaskolite majority owner Pritzker Private Capital.
The deal marks the 23rd acquisition in 16 years for Plaskolite. Most recently, in April 2023, the firm acquired an acrylic sheet plant in Matamoros, Mexico, from materials firm Trinseo. Based on sales, Plaskolite is North America's 12th-largest film and sheet maker in Plastics News' ranking. The firm has annual estimated sales of more than $850 million. Azek is a major building products maker that posted sales of $1.4 billion in 2022.
• Sigma Plastics Group, one of North America's largest film and sheet makers, bought a recycling company in Tennessee with plans to expand operations. Sigma's deal for the assets of InSource Materials LLC of Henry, Tenn., includes equipment, a 112,000-square-foot building and 14 acres. The facility handles both post-consumer and post-industrial plastics.
Plans already are underway to expand the location, which is being renamed Sigma Renew 360. "The acquisition … allows Sigma Plastics to show our commitment to sustainable packaging and a circular economy by having a dedicated PCR recycling location to meet the growing demand for PCR content in our films," Sigma CEO Mark Teo said in a statement.
InSource Materials shreds, grinds, pelletizes and provides pelletizing and shredding toll services to others. Sigma Plastics, based in Pompano Beach, Fla., has 45 manufacturing sites with a capacity to handle more than 2 billion pounds of resin each year.
• Tekni-Plex Inc. made a deal to acquire Seisa Medical Inc. in a move that will "significantly expand" the company's medical side of the business.
Tekni-Plex, based in Wayne, Pa., and operates in both health care and consumer packaging, has a definitive agreement for the purchase of the medical device maker that "enhances the company's materials science and process technologies for minimally invasive and interventional therapy devices on a global scale," the company said.
Seisa, based in El Paso, Texas, employs more than 2,000 people at four locations in the U.S., Mexico and Slovakia. The company calls itself a contract manufacturer of medical devices and components with capabilities including injection molding, extrusion, laser cutting and welding.
Seisa makes medical devices and provides services all along a product's life cycle, including design and development, component manufacturing and final assembly.
• Auburn Hills, Mich.-based automotive supplier TI Fluid Systems has acquired Budapest, Hungary-based injection molder Cascade Engineering Europe from Grand Rapids, Mich.-based Cascade Engineering Inc. for $27.7 million.
"Our acquisition of CEE is tangible evidence that we are delivering on our electrification strategy," Hans Dieltjens, president and CEO of TI Fluid Systems, said.
CEE is expected to generate 2023 sales of $37.4 million. The acquisition includes an almost 70,000-square-foot facility. TIFS will keep on CEE's 349 employees.
• Alum Bank, Pa.-based Creative Composites Group, a maker of fiber-reinforced polymer composites, acquired the assets of Springfield, Ohio-based United Fiberglass of America Inc. (UF), a manufacturer of fiberglass pipe, conduit and bridge drain infrastructure systems.
The $14 million deal expands CCG's capabilities and helps it reach more markets. CCG is a subsidiary of Hill & Smith Holding plc. Founded in 1983, UF serves the public utility, transportation, commercial and technology markets with fiberglass products that result in stronger and lighter structures compared with other materials.
Founded in 1973, CCG develops lightweight, durable, cost-effective FRP products for structurally demanding uses and corrosive environments.
• Sweden's KB Components AB expanded in North America by purchasing injection molding companies in Toronto and Dallas.
The Örkelljunga, Sweden-based company announced the purchase of Innotech Precision Inc., an injection molder located in Toronto that focuses on functional and highly complex plastic components for industrial and automotive applications. Innotech employs 60 and uses electric injection molding machines with automation. It does horizontal and vertical injection molding.
That deal follows the purchase of QT Industries LLC, a Dallas-based injection molder and contract manufacturer.
• In the communications field, the torch was passed at AH&M Inc. as president and CEO Amy Godfrey acquired the business from Jim Allison. Allison has retired from Pittsfield, Mass.-based AH&M, which he co-founded in 1988.
Godfrey has more than 23 years of experience working with plastics and chemical suppliers and other multinationals. Since joining AH&M in 2000, she has held positions of increasing responsibility and led many of the agency's key accounts.
Prior to founding AH&M, Allison spent four years at materials firm GE Plastics. That business became a major AH&M client and continued to work with AH&M after being acquired by Saudi Basic Industries Corp.
• To the surprise of no one, the cheesiest plastics M&A deal of the second half of 2023 took place in Wisconsin. That's where an iconic combination of polyurethane and sports fandom was sold to a professional football team more than 35 years after the creator's brainstorm while fixing furniture.
The unlikely history of the Cheesehead foam hat, which has enjoyed nearly two generations on the market, has a new chapter with the purchase of Foamation Inc., the company behind the novelty hat, by the Green Bay Packers.
The Cheesehead was the brainstorm of Ralph Bruno, who was inspired to fashion the original model out of a piece of polyurethane while reupholstering a couch for his mother in 1987. It's a unique company acquired by a unique football team as the Packers are the only publicly owned franchise in the National Football League.