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By Don Loepp
EDITOR
Published: August 13, 2013 5:52 pm ET
Portola Packaging Inc. — a closure molder that has jettisoned operations to focus on its compression molded, tamper-evident cap business — will soon have a new owner.
Stamford, Conn.-based Silgan Holdings Inc. announced Aug. 13 that it has signed a definitive agreement to buy Portola for $266 million.
Naperville, Ill.-based Portola has eight plants in North America and Europe and posted 2012 sales of about $200 million.
"We believe that the acquisition of Portola broadens our global closure franchise," said Bob Lewis, Silgan's executive vice president and chief financial officer, in a news release. He said Silgan is "excited about the opportunity to expand our relatively small European plastic closure presence through Portola's manufacturing facilities in the United Kingdom and Czech Republic."
Silgan, a publicly traded packaging company, is a bigger player in closures than Portola. In the second quarter of 2012, the company posted closure sales of $181.4 million — but that includes both metal and plastic products. According to a recent market study, there are 100-150 U.S. companies making caps and closures, and Silgan is in the top six.
Portola emerged from a prepackaged Chapter 11 reorganization in 2008 and started on a strategy centered on lean manufacturing and focusing on products where it had a leading market position.
Last year, for example, Portola exited the cosmetics market, closing plants in Rhode Island and China. This year, the company followed up with a plan to spend $12 million to install new high-speed compression and injection molding equipment, upgrade existing production lines, and make infrastructure replacements and upgrades at its plants in Kingsport, Tenn., and Tolleson, Ariz.
The deal with Silgan is scheduled to close as early as September.
Silgan had 2012 sales of $3.6 billion. The company makes plastic and metal containers and closures, and has 81 plants around the world. | |
