The acquisition of medical packaging converter Jen-Coat by Wellspring Capital Management includes investment by a familiar name to many in flexible packaging: Harold Bevis, former ceo of Pliant Corp.
In an interview with Packaging Strategies, a BNP Media sister publication of Flexible Packaging, Bevis says the purchase was the first under a newly created (and unnamed) holding company that he would manage. The object, according to Bevis, is to create a high-end flexible packaging converter in medical and food applications with sales of roughly $500mn to $700mn annually and with a leadership position in innovation and technology.
That new company could offer a competitive challenge to some of the bigger names in high-end, flexible packaging converting: Bemis, Sealed Air/Cryovac, Winpak, and Amcor Flexibles. Some of Pliant’s former customers are among the companies that Bevis is attempting to emulate or even purchase.
“As I got to know the packaging business strategically and understand packaging [while at Pliant], I knew that a better place to be in the packaging world was in the high-end space,” Bevis states. “I really wanted to transform the business model of Pliant into an area more stable and predictable and less volatile. But when Berry Plastics stepped up, we know that would be a good home.”
First piece of a ‘puzzle’
Bevis helmed Pliant, Schaumburg, Ill., for six years before Berry bought the company in December 2009. During his tenure, the film producer-with annual sales of around $1.1bn at the time of the sale-built a reputation in innovation. Yet, Bevis says, Pliant could not escape its status as a low-end, commodity maker of sealant and barrier films and was held hostage to material pricing fluctuation and margin pressures.
Now, Bevis is focused on creating a smaller, but dynamic flexible packaging company; he and Wellspring plan to either acquire or build packaging properties in a short period that will fit its mission. “We have a systemic program in place, and this is just the first piece of the puzzle,” he says.
Jen-Coat, Westfield, MA, offers notable technology in the construction of composite substrates for flexible lidding, single-use packets and sachets, label products, release liners, and various food and medical structures. Its extrusion coating and laminating operations are major strengths, Bevis adds.
Ultimately, Jen-Coat could be part of a larger nucleus that could lead to an initial public offering or a sale to a financial or strategic sponsor in the next four to six years, Bevis says. A slowdown in the acquisitions market will not affect growth. “If we can’t buy the right company, we will ‘greenfield’ it,” he notes.
-- Joe Pryweller, managing editor, Packaging Strategies.
This article appears in the August 15, 2010 issue of Packaging Strategies Newsletter, a sister publication of Flexible Packaging. For more information, visit Packstrat.com.