Spartech Corporation Announces Agreement to Purchase Packaging Business
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ST. LOUIS, Sept. 6 -- Spartech Corporation (NYSE:SEH) announced today that it has entered into an agreement to acquire the stock of Creative Forming. Inc. (Creative), a custom manufacturer of plastic packaging with approximately $48 million in annual sales. Creative designs and produces value-added packaging solutions primarily for the food, consumer product, produce, and medical/pharmaceutical markets from its 160,000 square foot facility in Ripon, Wisconsin.
Spartech's interim President and Chief Executive Officer, Randy C. Martin stated, "Creative has demonstrated the ability to achieve strong growth and profitability performance while developing key relationships with customers to provide comprehensive design and engineering capabilities. Creative provides key technologies to the packaging market and a strong management team to complement Spartech's resources serving this growth market. The Creative acquisition provides the catalyst to focus several of our operations on developing new business and increasing our services to the packaging market. Over the past eight years, we have successfully developed our packaging capabilities in food and consumer containers. Through the development of multi-layer barrier and shelf-stable packaging we have consistently grown our sales in this market and enhanced the value-added packaging solutions we offer our customers. The Ripon facility will combine efforts with five existing Spartech facilities to form a packaging technologies business that reports to David Gorenc, Spartech Packaging Technologies Vice President."
Mr. Martin continued, "These operations will combine the breadth of material capabilities of Spartech with the design capabilities of Creative. These combined strengths will: (i) structure the management and operating resources on focused growth potential in our respective Spartech Packaging Technologies' and Spartech Custom Sheet businesses, (ii) expand our collective efforts on design, marketing, and industry presence in the growing packaging market, and (iii) enhance the development of new capabilities and further expansion of centers of excellence serving our customers. These benefits will offer new opportunities for us to add value to Spartech and Creative Forming customers and we expect the acquisition to be accretive for shareholders in the first year."
Mr. Martin added, "The cash price for this acquisition is approximately $61.0 million plus changes in working capital. The acquisition will be financed from our bank credit facility and operating cash flows and is expected to close on September 14, 2007."
Spartech Corporation is a leading producer of engineered thermoplastic sheet materials, polymeric compounds and concentrates, and engineered product solutions. The Company has facilities located throughout the United States, Canada, Mexico, and Europe with sales of approximately $1.5 billion, annually. Spartech provided updated guidance in a separate release dated today and is scheduled to release its third quarter results and conduct a conference call on September 13, 2007.
Source: Spartech Corporation
CONTACT: Randy C. Martin, President and Chief Executive Officer,
+1-314-721-4242, or Steven G. Ploeger, Executive Vice President, Custom
+Sheet
and Rollstock, +1-314-721-4242, both of Spartech Corporation
Web site: http://www.spartech.com/
