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Corporate
Bottling up Central Europe
Plymouth-based Plastipak Holdings Inc. is expanding into central Europe, setting up three new facilities in the Czech Republic and Slovakia. The 37-year-old, family-owned company already is one of the nation's largest designers and manufacturers of plastic packaging containers. Its key customers include Procter & Gamble Co.'s heavy-duty liquid laundry detergents, Kraft Foods Inc.'s salad dressings and PepsiCo Inc.'s Gatorade. But virtually all of Plastipak's customers are in the United States.
Plastipak opened a Brazilian operation, which employs 153 people, eight years ago; by contrast, Plastipak employs 3,600 domestically.
That could change as the company continues to expand overseas.
Plastipak Czech Republic s.r.o., a wholly owned subsidiary of Plastipak Packaging, was established last year and will serve as a bottle manufacturing facility, according to a company filing with the U.S. Securities and Exchange Commission.
Plastipak will invest $15 million in Clean Tech Slovakia s.r.o., a post-consumer recycling operation wholly owned by Plastipak’s Clean Tech Inc.
Meanwhile, Plastipak Slovakia s.r.o. will invest $3.6 million on a technical and design center and to provide sales, marketing and administrative services to Plastipak’s central European operations. The investment, the company said in the SEC filing, is contingent on a grant from a recycling fund established by the Slovakian government.
The facility will recycle over 14,000 metric tons of plastic bottles and initially employ 50-60 people.
“We believe this to be one of, if not the only dedicated rigid packaging technical center located in central Europe,” the company said in the SEC filing.
William C. Young, Plastipak’s chairman, president and CEO, did not return telephone calls for this story; calls to Frank Pollock, the company’s vice president of international marketing and business development, also were not returned.
“When it comes to innovations in packaging, they are one of the companies often mentioned,” said Susan Selke, a packaging professor at Michigan State University.
The expansion comes at a time when the countries - particularly Slovakia, where Ron Weiser, the founder and former chairman of Ann Arbor-based McKinley Associates, is the U.S. ambassador - are hungry for foreign investment.
Both the Czech Republic and Slovakia are expected to join the European Union later this year.
Plastipak designs, makes and distributes plastic containers for carbonated and non-carbonated beverages, consumer cleaning, food and processed juices, and industrial, automotive and agricultural products. It holds 130 U.S. patents.
In the fiscal year ended Nov. 2, Plastipak earned $4.4 million on sales of $897.8 million - 45 percent of which was attributed to carbonated and non-carbonated beverages - according to SEC filings. It made and distributed about 7.4 billion containers worldwide for more than 450 customers.
In fiscal 2002, Plastipak earned $8.6 million on sales of $812.2 million.
The company said consumer preference for plastic containers rather than glass and metal containers is fueling its sales growth.
Plastipak’s primary national competitors include Atlanta-based Consolidated Container Co. and Toledo-based Owens-Illinois Inc., as well as retail companies that maintain their own in-house packaging operations.
