Deal-making pace edges upwardMergers and acquisitions among suppliers of packaging materials and equipment are still below pre-recession levels but are starting to edge upward, according to a report from BMO Capital Markets Packaging Group.
BMO reported that mergers and acquisitions among packaging suppliers are down 53% over the 12 months ending in August compared to peak levels in 2007. However, global mergers and acquisitions among suppliers were up 12.9% in 2010 to date over the same period last year. Activity was down in North America and Europe, but this was offset by gains across the rest of the world.
Three recent acquisitions have involved some of the biggest names among material suppliers:
Pactiv, a manufacturer of flexible packaging as well as consumer packaging and other products, was acquired in August for about $6 billion by New Zealand’s Rank Group Ltd. Rank, a privately held company, also owns Reynolds Group Holdings (which Pactiv will join) and acquired Alcoa’s packaging business in 2008. The deal comprised about $4.5 billion in cash and $1.5 billion in debt assumption.
Sonoco acquiredAssociated Packaging Technologiesin June for about $120 million in cash. Associated Packaging Technologies is North America’s largest supplier of crystallized polyethylene terephthalate trays, widely used for frozen foods.
Ball Corp.sold its plastics packaging business in June toAmcor Ltd.for $280 million. The sale of Ball’s Plastics Packaging, Americas, unit involves plants in five states that produce polypropylene bottles and PET bottles and preforms.
For the 12 months ending in March, Ball’s plastics business amounted to $589 million in sales and $10 million in earnings. According to Ball’s most recent 10-K, plastics packaging represented 9% of the company’s net sales in 2009. The company estimates that the 5 billion PET bottles it shipped in 2009 represents 8% of the U.S. total.
On the machinery side, in a deal involving suppliers of material-handling systems,The Dematic Group, based in Luxembourg, has announced its intent to purchaseHK Systems. Terms of the deal, which is expected to close in the third quarter, were not disclosed.
Chinese machinery imports increaseChina surpassed Japan as the world’s second-largest economy last quarter. Its status as a large and growing market for packaging machinery is well established.
China achieved the status of second-largest market for packaging machinery more than a year ago, at an estimated $8 billion. It is now on a pace to become the largest second importer of packaging machinery worldwide this year, with estimated imports of $1.5 billion. Development is expected to continue, with an average growth rate of 8.7% percent expected annually through 2014, according to PMMI’s China fact sheet.
“The Chinese economy keeps on growing, and the need for packaging machinery is growing with it,” said Jorge Izquierdo, PMMI’s vice president of market development. “Soon we expect China to be the world’s largest packaging machinery market, making it a compelling marketplace for both PMMI members and their customers.”
PMMI maintains a China Office and conducts local programs like the upcoming Export Conference, which will be held in conjunction with PMMI’s Annual Meeting in Greenville, S.C. The conference will take place at 1:30 p.m. Wednesday, Sept. 15. The agenda can be accesed at www.pmmi.org.
Supplier BriefsPro Machhas been awarded the first ever 2010 Manny Green Award fromCincy Magazinefor sustainability initiatives. Three Pro Mach divisions were singled out:Fowler, for helping water bottlers downgauge packaging;Roberts PolyPro, for its sustainable beverage handles; andOrion, for helping a fresh produce customer reduce product loss.
Nick Wilson, president of Morrison Container Handling Solutions, has been named to the advisory council of the Purdue Technology Center of Northwest Indiana, in Crown Pointe, Ind.
Cal Borgman has been hired as field sales manager of Change Parts Inc., a supplier of rebuilt packaging machinery and change components.
Motoman Roboticshas broken ground for its new facility in Miamisburg, Ohio. The 300,000-square-foot facility, which will serve as Motoman’s headquarters and main manufacturing facility, is scheduled to open in June 2011.
Wendy Churchhas been appointed to the newly created position of creative director for strategic branding atProduct Ventures, a packaging design firm. Church has worked for consumer goods companies including Nestle, P&G, Gillette, Ocean Spray and Unilever.
Sean Murphyhas been hired as leader of sales empowerment programs atBarry-Wehmiller, a supplier of a wide variety of packaging equipment.
Multivac, a supplier of thermoforming equipment and materials, has promotedMark Wilhelmto sales manager, eastern division;Gregg Poffenbargerto sales manager, western division; andBill Williamsto product manager for compact packaging systems and tray sealers.
The Can Manufacturers Institutecelebrated the 100th anniversary of the food can on Aug. 25. It dates the food can from the patent granted to British inventorPeter Durandin 1810.
Report Abusive Comment