LVC buys Summit Plastics, targets more acquisitions

Private equity firm LongueVue Capital announced Jan. 20 it is investing in Mississippi-based blown film and bag maker Summit Plastics Inc. and said it plans to be "extremely active" in the packaging and plastics industries.

New Orleans-based LongueVue said the investment in Summit is its first in the plastics sector. It's providing growth capital to expand Summit's product offerings and its national footprint, including in bioresin films, said LVC Vice President Evan Golden. Terms were not disclosed.

LVC also said it's brought in a longtime plastics industry executive, Paul Ebbert, as its operating partner for a new specialty packaging investment strategy that could include buying other firms.

"This is our first step," said Ebbert. "This one just happens to be blown film and flexibles. It's not to say that will stay 100 percent blown film and flexible. We may venture outside of that."

LVC said it's managed over $500 million in capital and focuses on middle-market firms, with investments in health care, both in medical device manufacturing and nursing homes, along with transportation and airframe maintenance.

Summit makes custom low and linear low density polyethylene blown film and bags for end markets including food and beverage, industrial and health care. It operates a 90,000-square-foot manufacturing facility in Summit, Miss.

LVC said the business has grown rapidly since CEO Tom Nathanson bought Summit in 2015. It makes one-, three- and five-layer mono and multilayer films, and has more than 100 employees.

Summit ranked No. 111 in the most recent Plastics News survey of North American film and sheet manufacturers, with $32.3 million in sales and 13 extrusion lines.

"We are excited about our partnership with LongueVue Capital, as their deep industry relationships and track record of successfully supporting middle-market businesses will help Summit effectively navigate the next phase of our growth," Nathanson said in a news release.

Nathanson and the other ownership and management team will remain in place at Summit and retain "meaningful ownership positions," Golden said.

Ebbert, who held executive jobs at bag maker Novolex, Fortune Plastics and Clondalkin NA before joining LVC, said the private equity firm sees packaging as a good industry in the United States.

"We do like the U.S. manufacturing base; the U.S. is a low-cost producer of resin," he said. "We like that. And we think that the United States will continue to do well in plastics and packaging."

Golden said Nathanson and LVC Partner Ryan Nagim worked together in previous jobs, and the two firms spent several months talking about the potential investment.

LVC said it liked Summit's strong customer relationships and that the blown film maker has been achieving "exceptional, above-industry growth."

"We focus on partnering with entrepreneurs," Golden said. "We're not really in a position to disclose it fully but this was structured as a partnership."

He said LVC plans to be scouting opportunities in the packaging and plastics space.

"We're going to be extremely active, whether it's looking at synergistic acquisitions for Summit or new platform opportunities for standalone partnerships," Golden said.

He said LVC sees opportunities in the structure of the packaging industry, particularly with its entrepreneur-led companies.

"It's recession-resistant in markets like health care, food and beverage, and industrial applications that was extremely attractive to us about the industry," Golden said. "We think there's a lot of opportunity for professionalization and consolidation."