Board Converting News, April 12, 2021

BoardConverting Serving the North American Corrugated and Folding Carton Industries for 37 years April 12, 2021 VOL. 37, NO. 15

AICC Southeast Summit In NC: ‘In-Person’ And Successful BY LEN PRAZYCH With a socially distant and COVID-compliant group of a reported 68 members and guests, AICC, The Independent Packaging Association, successfully hosted its first in-person event in more than a year at its Southeast Summit, held March 31 to April 1 at the Grandover Resort in Greensboro, North Carolina.

SupplyOne Acquires Bell Container Corp.

Newtown Square, Pennsylvania based Sup- plyOne, Inc., one of the largest independent suppliers of corrugated and other value-add- ed packaging products, equipment, and ser- vices in the U.S., announced that it has ac- quired Bell Container Corp, a privately-held manufacturer of custom corrugated products headquartered in Newark, New Jersey. Founded in 1919, Bell Container Corp. is one of the largest independent full-service corrugated manufacturers in New Jersey, serving customers in the greater New York metropolitan area. The company manufac- tures custom corrugated boxes, die-cuts, and displays, converting two billion square-feet of corrugated products annually. Bell Container is ISO 9001-2015, and SFI CoC Certified, and audited GMP approved. “This transaction will allow Bell Container to bring new efficiencies and speed to mar- ket solutions to its customers by addressing all of their packaging requirements from one point of contact,” said William Leith, CEO and President of SupplyOne. “In addition to cus- tom corrugated solutions, the company’s of- fering will expand to include SupplyOne’s en-

AICC President Mike D’Angelo opened the meeting promptly at 11:00 a.m. on Wednesday, March 31, and welcomed an anticipatory au- dience seated at appropriately distanced intervals at circular tables in the Grandover’s large ballroom. An AICC “swag bag” of hand sanitizer, “smell cards,” a face mask and a button with the phrase “no offense, it just makes sense” printed on a round pin on which a red line crossed two hands shaking, were given to attendees as a reminder that health and safety were to be a priority during the two-day affair. After thanking those who honored their commitment to attend the first in-person meeting in more than a year and thus, a return to semi-normalcy, D’Angelo presented a brief state of the association, citing a membership retention rate of 94 percent, a surge in the use CONTINUED ON PAGE 26 AICC President Mike D’Angelo welcomed attendees to the Association’s first in-person meeting in more than a year at AICC’s Southeast Summit at the Grandover Resort in Greensboro, North Carolina.


WHAT’S INSIDE Hood Container Corp. Acquires Sonoco’s U.S. Display Business

6 x x 8 x x 12 x x 26 x x

10 Ray Rammelsberg, Formerly Of Valco Melton, Dies At 68 PPC Honors Voorhees With Lifetime Achievement Award 0 The Current Pace Of Mergers & Acquisitions

Machinery and Handling for the Corrugated Board Industry

AVERAGE CONTAINERBOARD PRICES The average prices reported are tabulated from prices PAID by various sources throughout the United States the week previous to issue. Prices in some areas of the country may be higher or lower than the tabulated average. The prices tabulated here are intended only for purposes of reference. They do not connote any commitment to sell any material at the indicated average. Transactions may be completed at any time at a price agreed upon by seller and purchaser.

REGION E. Coast Midwest Southeast Southwest

42# Kraft liner $955.00-960.00 $970.00-980.00 $970.00-980.00 $970.00-980.00 $1000.00-1010.00 $973.00-982.00

26# Semi-Chem. Medium

Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del.

$890.00-940.00 $905.00-925.00 $905.00-925.00 $905.00-925.00 $925.00-945.00 $908.00-928.00

West Coast U.S. Average

SHEET PRICES BY REGION (AVERAGE) Per 1MSF, local delivery included, 50MSF single item order, truckload delivery. Sheets

E. Coast Midwest South-SW S. CA N.CA/WA-OR US Aver.

200# 275#



$62.69 $82.80

$85.35 119.54

$73.13 101.29












107.46 118.45

114.69 129.32

116.54 137.25 117.82 145.56

141.08 148.46

122.76 131.80


CANADIAN SHEET PRICES (AVERAGE) In Canadian Dollars, per 1MSF, local delivery included, under 50MSF single item order, truckload delivery. 200# 275# Oyster UC 275#DW 350#DW $78.56 $99.18 $9.00 $96.32 $105.83 CANADIAN LINERBOARD & MEDIUM The average prices reported are tabulated from prices PAID by various sources throughout Canada. Prices may be higher or lower in various areas of the country. The prices tabulated here are intended only for purposes of reference. They do not connote any commitment to sell any material at the indicated average. Transactions may be completed at any time at a price agreed upon by seller and purchaser. Prices are Canadian $ and per metric ton.

42# Kraft Liner 26#

Semi-Chem Medium

East West


$960.00 $995.00



April 12, 2021

SupplyOne Acquires (CONT’D FROM PAGE 4)

Core Competency

gineered packaging supplies, packaging automation, and service programs designed to enhance customers’ profit- ability. Throughout their 100-year history, Bell Container’s dedicated employees have earned the confidence of their customers by providing the highest quality products and exemplary service. We are delighted to welcome them to the SupplyOne family.” “We are enthusiastic about joining SupplyOne’s team, and the synergies that come from combining Bell’s cor- rugated manufacturing capabilities with SupplyOne’s val- ued-added distribution expertise,” said Arnie Kaplan, Pres- ident & CEO of Bell Container. “As part of SupplyOne’s national network, we will be able to service our customers who have locations outside of the tri-state area. We are particularly excited about SupplyOne’s sales programs, food packaging expertise and equipment automation, which will make our customers more profitable.” SupplyOne provides mid-sized manufacturers, food processors, medical and e-commerce companies indus- try-leading packaging programs, products, and supply chain solutions to unlock efficiencies and cost savings. Since its founding in 1998, SupplyOne has become the acquirer of choice for privately held specialty corrugated packaging manufacturers and value-added packaging dis- tributors. SupplyOne is a portfolio company of Wellspring Capital Management.. Visit .

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Hood Container Corp. Acquires Sonoco’s U.S. Display Business

and fulfillment facilities along with four sales and design centers and has approximately 450 employees. “Our U.S. Display and Packaging business has been an industry pioneer with a legacy of providing innovative solutions for complex supply chain challenges,” said How- ard Coker, Sonoco President and CEO. “However, Sonoco is focused on growing our core Consumer and Industrial packaging businesses around the world, and by divesting this business we expect to apply proceeds to further invest in ourselves while returning value to our shareholders.” According to Zack’s Equity Research, Sonoco’s Dis- play and Packaging business had been bearing the brunt of weak retail promotional display activity. In December 2020, the company sold its Display and Packaging seg- ment’s contract packaging business in Europe to Prairie Industries Holdings for cash proceeds of $120 million. This divesture is expected to have unfavorably impacted the company’s bottom-line results during the March-end quarter.

Atlanta, Georgia based Hood Container Corporation, a family owned paperboard and specialty paper manufactur- er with operations in containerboard, kraft paper, corrugat- ed boxes, high-graphic displays and contract packaging, corrugated, folded box and displays, has purchased the U.S. Display and Packaging business of Hartsville, South Carolina based Sonoco for $80 million in cash. Sonoco’s U.S. Display and Packaging business pro- duced net sales of approximately $135 million in 2020 and provides point-of-purchase display design, manufacturing and fulfillment as well as contract packaging services for consumer product customers with more than 250 brands. Based in Winston-Salem, North Carolina, the Display and Packaging business operates eight manufacturing

Oliver Inc. Acquires Boutwell Packaging

Oliver Inc. a manufacturer of high-quality folding carton and blister card packaging serving personal care, healthcare, automo- tive aftermarket, food and beverage, and consumer products markets with operations in New York, Ohio and Virginia, has con- firmed it has acquired Fitchburg, Massachu- setts based Boutwell Packaging. “Oliver is pleased to announce the acqui- sition of Boutwell to strengthen our position as a leading provider of custom paperboard packaging,” said Dan Rodenbush, President and CEO of Oliver. “With the addition of the Boutwell team, we will increase our reach into key markets while expanding our capa- bilities and capacity. We are proud to wel- come Boutwell to the Oliver family.” “Boutwell is extremely excited to team up with Oliver,” added Ward McLaughlin, CEO of Boutwell. “The combination of Boutwell and Oliver will generate value for our cus- tomers by expanding our ability to create unique, innovative, and sustainable world- class packaging.” Oliver has made significant investments in modern equipment, facilities, and people since Pfingsten became the majority share- holder in May 2016. The Boutwell trans- action represents Oliver’s third strategic acquisition and aligns with the company’s strategy to create a leading provider of in- novative, high-quality packaging solutions. The transaction closed March 31, 2021.


April 12, 2021

40 ft of paper travel from preheater to hot plates 3 seconds of heat, glue and bonding 1 chance to get it right! the ZONE

Design & Production

Chicago Electric offers 10 technology solutions to control ‘the Zone’ CORRUGATOR Sectoral preheating plate

Our sectoral preheating plates provide direct heat by means of a double steam circuit, allowing for efficient heating in hard-to-access locations, as well as to act as a steam shower to open the paper’s fibre, making it receptive to absorbing the heat and the glue.

This translates into increased speed and improved quality of the cardboard sheet finish.

The system’s main advantages are as follows:

• The plate may only be used to heat, only to humidify, or both options at the same time. • The plate is sectored, which allows for applying humidity to the sections. • It provides temperature in previously inaccessible locations and near the location needed. • It compensates the loss of temperature dissipated due to distance, speed or limitations of the exiting preheaters. • Quick transferring of heat to the paper. • The combination of the hot plate and steam shower allows for providing heat even to the hardest papers to heat. • Does not dry out the paper. • Possibility of operating as a humidifier and pre-conditioner. • Maintains and improves the fibre’s elasticity. • Acts according to the operator’s needs. • Facilitates the paper’s hygroscopy to absorb the glue and improve rubberising.


1. Wrap Arm - Position & Temperature 2. Preheater Direct Drive


3. Steam Plate 4. Contact Roll 5. Glue Machine Direct Drive Touch Productivity Issue—Glue Unit Many glue units run with a rider roll or a guiding bar system. The rider roll with paper gap allows a precise glue application, but requires frequent Contact Roll


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calibrations and settings. Bar systems avoid this, but compensate this with the risk of exces- sive glue application. The system contains many wearing parts. Solution The contact roll combines the ad antage of both systems and ensures minimum contact between board and applicator roll. The system uses small pneumatic cylinders in order to achieve a “soft touch.”

6. Gap Control 7. Curved Plate 8. Roller Shoe Press When it comes to a short-term increas of web tension, spring loaded systems with shoes or airpressure activated system have problems in compensating these. The system is lifted for a short time. This may result in de-lamination and in the ‘double kiss’ effect. Solution For a defined and exact bonding point of the web fiv weight rollers will be installed usually over the first flat hotplate of the heating section. The rolls are mounted into a frame, which is actuated by means of two pneumatic cylinders. P oductivity Issu —Double Kiss Bonding




Roller Shoe


9. Thin Wall Hot Plates 10. Pressure System Benefits —Exact glue application due to defined contact of applicator roll to web. Web is in contact to less flute tips compared to bar systems. • High precision glue application • Less moisture applied to web —No wear of shoes and springs —No adjustment of shoes or paper gap —Uniform glue application over entire working width for all flutes by use of pneumatic cylinders instead of springs — Less contamination by paper dust and glue remains —No jam of board because of web breaks caused by splice joints going through 630-784-0800 Benefits —Rollers secure exact defined first point of contact of liner and single-faced board - No double kiss —Frame design avoids unintended lifting of roller shoe (compared to spring or air loaded systems) - No double kiss —Pressure can be increased or released for special grades or products 490 Tower Blvd., Carol Stream, IL Contact Chicago Electric to GET IT RIGHT 630-784-0800 Solution The ProPress system ensures an optimum heat transfer to the board. It offers a wide range of set- tings. The loadi g pressure can be varied, the number of shoes can be lifted in accordance t the line speed. The outer shoes can be lifted in accordance to the paper width. The shoe bars will be delivered pre-assembled for a short installation time. —Liftable for easy paper infeed and for cleaning of the machine —Position adjustable in paper direction to avoid grooves in hotplate Press Productivity Issue—Poor Heat Transfer Rollers are usually limiting the heat transfer, since they often have contact mainly on the edges of the plates due to wear or bent plates. They also cause often loss of caliper and bearing need to be replaced frequently. Airpressure actuated systems can only supply a limited pressure and have com- pared to shoe systems a closed surface. Pressure Shoe

Plate vity Issue—Poor Heat Control l hotplates are slow to react to pressure due to high steam volume and massive y also have high heat radiation and heat profile. Worn plates can damage crease edge crush.

Thin-Wall Hot Plates

t by peripheral drilled hot plates. anufactured out of special wear and nt steel, through which a continuous is drilled, with one inlet and one outlet. ecured by a massive steel frame.

ance from steam to paper surface results in fast heat flow n higher plate surface temperature


ISM: Manufacturing Expands For 10th Consecutive Month In March 2021 Economic activity in the manufacturing sector grew in March, with the overall economy notching a 10th consecu- tive month of growth, say the nation’s supply executives in the latest Manufacturing ISM Report On Business. The report was issued last week by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Manage- ment (ISM) Manufacturing Business Survey Committee: “The March Manufacturing PMI registered 64.7 percent, an increase of 3.9 percentage points from the February reading of 60.8 percent. This figure indicates expansion in the overall economy for the 10th month in a row after contraction in April. The New Orders Index registered 68 percent, up 3.2 percentage points from the February read- ing of 64.8 percent. “The Production Index registered 68.1 percent, an in- crease of 4.9 percentage points compared to the Febru- ary reading of 63.2 percent. The Backlog of Orders Index registered 67.5 percent, 3.5 percentage points above the February reading of 64 percent. The Employment Index registered 59.6 percent, 5.2 percentage points higher than the February reading of 54.4 percent. The Supplier Deliveries Index registered 76.6 percent, up 4.6 percent- age points from the February figure of 72 percent. The CONTINUED ON PAGE 40

Box Shipments ( U.S. Corrugated Product Shipments) Industry Shipments In Billions of Square Feet Month December 2020



Percent Change Avg Week Percent Change

2020 2019

34.916 31.332


8.729 7.833


Industry Total

Year-to Date

December 2020



Percent Change Avg Week Percent Change

2020 2019

406.776 393.483


8.071 7.838


Industry Total

Containerboard Consumption (Thousands of Tons)



Percent Change Year-to-Date Percent Change

2020 2019

2.7727 2.5660


33.0739 32.3005


Container Board Inventory - Corrugator Plants (Thousands of Tons)

Corrugator Plants Only


Percent Change Weeks of Supply

Percent Change

Dec. Nov.

1.8921 1.7912


2.7 2.5


Shipping Days




2020 2019

20 20

252 251

SOURCE: Fibre Box Association

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Ray Rammelsberg, Formerly Of Valco Melton, Dies At 68

The Perfect Combo Get Peak Performance From Your Equipment with Matched Component Sets

Raymond (Ray) Rammelsberg Jr., passed away at home on March 28, 2021, in California, Kentucky, of cancer. He

began his career on September 26, 1988, at Valco Melton (for- merly Valco Cincinnati) as Man- ager of Engineered Products, at the Corporate Office in Cincin- nati, Ohio. During Ray’s very successful

career of more than 30 years he impacted the company’s growth in adhesive application and quality assurance products through his tireless efforts in multiple upper sales manage- ment roles until his final position as Sales Manager, Corrugated and Corporate Accounts, prior to retiring in 2019. He is survived by his wife, Sharri Rammelsberg; sons Joe Rammelsberg, Ian Hamilton, Drew Hamilton, and Jus- tin Shawl; step-daughters Heather Kremer, Kassie Arnett, Brooke Webster and Ashley Pfeffer; brother David Ram- melsberg; sisters Barbara Heck and Beverly Dorgan; and four grandchildren. Ray Rammelsberg

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PPC Honors Former WestRock CEO Voorhees With Robt. T. Gair Lifetime Achievement Award The Paperboard Packaging Council (PPC) has selected Steven C. Voor- hees, former CEO of WestRock, as the recipient of its 2021 Robert T. Gair Award. Named after the man whose innovation gave birth to the modern

folding carton, the Robert T. Gair Award is reserved for individuals who have made significant and lasting contributions to the paperboard packaging industry.

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Steven Voorhees Long before Voorhees found himself driving success for one of the world’s largest paper and packaging companies, he was pushing a lawnmower across the lawn of his childhood home in Michigan. Voorhees attributes this and other chores to his father, a navy commander with a post-retirement career in the chemical in- dustry, as instilling within him the strong work ethic that would serve him throughout his career. After receiving his undergraduate degree from Northwestern Universi- ty and MBA from the University of Virginia, Voorhees spent the first leg of his career working for the Birmingham, Alabama based energy company, Sonat. He went on to join the paperboard packaging firm, RockTenn, which would later become WestRock as part of a merger under Voorhees’ guid- ance. He held numerous leadership positions there before being named CEO in 2013. Voorhees’ many accomplishments center around expanding West- Rock’s capabilities, geographic presence and industry leadership with nu- merous acquisitions. Voorhees is known for cultivating a corporate culture that delivered immeasurable value to customers, stockholders and team- mates alike. “I congratulate Mr. Voorhees on his significant accomplishment—and it is significant. In fact, PPC has only given 19 Gair Awards during its 92- year history,” said Ben Markens, PPC President. “Only the most committed and exemplary individuals can receive the award, those who have left an indelible mark not only on the industry but on PPC as well as their own communities. Without a doubt, Mr. Voorhees fits the bill.” Indeed, Voorhees’ impact extends beyond our industry. As a commu- nity partner, he has lent his business and leadership expertise to sever- al Metro Atlanta organizations, including Junior Achievement of Georgia and Boys & Girls Clubs. As an advocate for youth programs and educa- tion, Voorhees was one of the business leaders that supported the devel- opment of 3DE by Junior Achievement, an innovative approach to high school that integrates business connectivity into education to provide a real-world, authentic, experiential curriculum. “I am extremely grateful to the PPC for this exceptional recognition,” said Voorhees. “It has been a privilege to serve the paper and packaging industry, including WestRock as president and CEO. Thank you to all of the people who have supported me throughout my career and enabled this recognition, including my wife, Celia, and the incredible WestRock team members around the world who work tirelessly every day to connect peo- ple to essential, sustainable products.” Announced virtually last week during PPC’s Spring Meeting, the 2021 Robert T. Gair award will be celebrated in-person during the association’s Fall Conference, October 27-29, 2021, in Savannah, Georgia.

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Stoler Appointed CEO At Vanguard, Mathes To Be Executive Chairman Kansas City, Missouri based Vanguard Packaging, an in- dependent designer and manufacturer of value-added

management teams, cultivating data driven organizations and positioning businesses for best-in-class performance. “Vanguard is excited to have Chris join the team to lend his experiences to strong business growth,” said Mathes. AICC Offers New Free Online Course: Unit Load Design And Analysis AICC, in collaboration with National Wooden Pallet & Con- tainer Association, has released a new free online course for members, Unit Load Design and Analysis, available in English and Spanish. The interaction between the boxes and pallet deter- mines the success or failure of a shipment. Unit Load De- sign and Analysis provides an introduction into the sys- tem-level design of unit loads containing boxes. It covers the benefits, potential cost savings, environmental im- pacts, engineering & development, looks at a few case studies, and goes into depth about how boxes and pallets interact. The catalog of free online packaging courses is now over 90, with 20 translated into Spanish. More courses are added each month. Additional information about AICC on- line education can be found at agingSchool . Questions can be directed to Taryn Pyle, Di- rector of Education & Leadership Development, at tpyle@ or (703) 836-2422.

point-of-purchase displays, has an- nounced the appointment of Chris Stoler as its new Chief Executive Officer. Stoler will be responsible for creating the infrastructure to grow Vanguard organically through its sales driven culture, eCommerce, and acquisition.

Chris Stoler

Current CEO Mark Mathes has announced that he will be stepping away from the day-to-day management of the business to take on the new role of Executive Chairman. Mathes’s focuses going forward will be to lead M&A and to work to make the company a stronger national level dis- play and packaging company. Stoler is a veteran of the manufacturing industry of pa- per-based food packaging, corrugated packaging, adhe- sives, plastics, and agriculture equipment. In his most re- cent position, he was the President of FDC Graphics Films where he had full P&L responsibility for all aspects of the operation. Stoler and his team were able to double the revenue of the business. In these roles, his experiences included strategic planning, building high performance


April 12, 2021

Apex International ‘Vision: 2020s’ To Boost Capacity, Increase Speed The Netherlands based Apex International, one of the world’s leading producer of anilox and ink metering tech- nologies, has announced the implementation of its long- range “Vision: 2020s” plan with significant expansion in each of its five global manufacturing facilities. As part of its phased growth strategy, new buildings, new production equipment, and new personnel will enable Apex to scale up production capacity while elevating industry bench- marks for quality. The company better positioned to meet increased demand from its flexo, label, and corrugated customer base for reliable, predictable, and durable me- tering products. “Based on technology and market trends in the last de- cade, Apex planned major investments into global facili-

ties and capital equipment to address anticipated industry growth,” said Marian Waterschoot, CEO of Apex Interna- tional. “We are pleased to now witness the realization of our ‘Vision: 2020s’ plan. As a result of the packaging in- dustry’s recent growth, our customers require our prod- ucts more promptly – and our expansion meets that world- wide demand.” Apex’s Vision: 2020s plan demonstrates its longstand- ing commitment to continual process improvement. “Apex reinvests 20 percent of its revenues into product research and development, new equipment, facility expansion, and professional development,” said Apex Chairman Ken Ral- ton. “Apex is the sole anilox manufacturer to commit such funding for product innovation and R&D. Our mission is as much scientific and exploratory as it is engineering and manufacturing.” Each of Apex’s manufacturing facilities are in the pro- cess of physical plant expansion or receipt of new, state-

of-the-art equipment. All new Apex buildings are constructed to ensure energy-efficiency and minimize carbon footprint. • Apex Italy, is nearing completion on new construction that increases its factory size by 33 percent. “This expansion allows us to further optimize production cycles and delivery times,” said Fabio and Stefano Della Torre, Directors of Apex Italy. • Apex North America, near Pittsburgh, Pennsylvania, has begun construction, planning to double the size of its man- ufacturing facility and enable a greater warehousing area for its ReadyRoll anilox roll and sleeve in-stock programs. “This long-awaited expansion will give our cus- tomers much quicker order turnaround,” said Apex North America’s Managing Di- rector Ruud van Cujik. • Apex Latin America in southern Brazil will soon take delivery of a new laser, which will increase production capability by 25 percent. “This expansion empowers us to meet the soaring demand for flexo and corrugated products in the Latin American market,” said Apex Latin America Manag- ing Director Valcinei Bisineli. • Apex Asia Pacific near Mumbai, India, re- cently installed the following new equip- ment: a laser, a precision CNC grinder, and a latest-technology plasma spray unit, which will provide coatings able to withstand the industry’s most demanding environments. These investments to the recently-constructed India facility boost production capacity by at least 40 percent and will enable the manufacture of larger corrugated and coating rolls. FlexoKITE’s


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Apex International (CONT’D FROM PAGE 16)

levels for leading industry suppliers and global print- ing converters, Mahesh’s deep understanding of flexo enhances Apex Asia’s solutions-and knowledge-driven sales mission. • Prasenjit Das comes to Apex Asia Pacific to fill the new position of VP/Marketing. He brings 20+ years of flexo experience and knowledge from his previous execu- tive positions at DuPont and Siegwerk. • Dan Pulling leads Apex’ new technical education pro- gram, FlexoKITE, as Experience Center Manager. Dan’s deep roots in flexography, pre-press, and plate opera- tions are suited to FlexoKITE’s mission to elevate flex- ography to a science-based profession. • Eleazar Meza joins Apex North America as Corrugated Development Manager. His long experience in corru- gated production and sales afford him unique skills to guide corrugated customers in streamlining their op- erations. Apex International is an award-winning global manufac- turer of anilox rolls, sleeves, glue sets, metering products, and print maintenance solutions. With five production fa- cilities on four continents, a growing portfolio of clients in over 80 countries, and a high-performance continuous-im- provement culture, Apex’s mission is the customer’s pro- duction success. Through technical innovation, service, and manufacturing precision, Apex delivers reliable, du- rable, and predictable metering solutions to its clients’ presses every day.

Asia knowledge lab is based here, complete with the latest technology to take artwork from plate to print, host press demonstrations, seminars, and webinars. An additional 10 acres of land was recently acquired for expansion of the Apex Asia Pacific facility. • Apex Europe in Hapert, the Netherlands, recently completed construction on its FlexoKITE knowledge lab which allows hosting of workshops, webinars, and live-running flexo trials. Further capital manufacturing investments include two new precision CNC grading machines and a ceramic plasma coating unit. New global staffing within the Apex International ranks include these key appointments: • Ruud van Cujik joins Apex North America as Managing Director. Ruud will oversee Apex North America’s fac- tory expansion, business development, and strategic growth. Ruud comes from the Netherlands where his most recent role at Apex HQ in Hapert was CFO, which he continues to hold. • Joe Settanni takes the reins as Apex North America’s VP/Sales. Joe brings to his new role more than 20 years of technical and anilox sales expertise – includ- ing his six years of service with Apex and a wealth of pre-press software, plate, and screen knowledge. • Mahesh Kode will assume the Apex Asia Pacific role of VP/Sales in mid-April. Having served at executive


April 12, 2021


growth between 2.5 percent and four percent this year. This doesn’t add up to a complete rebound for M&A activity, at least not right away. Many companies contin- ue to struggle, and many potential sellers, focused on re- storing their businesses to full health, have back-burnered their selling plans for now. In any case, it will be difficult to determine valuations until the market settles down and nervousness about the future subsides. Buyers Haven’t Gone Anywhere That said, owners whose print and packaging business- es came through the pandemic’s first year in reasonably good shape are still well positioned to sell on acceptable terms. This is because the buyers haven’t gone anywhere, even though they may have shifted into a lower gear for the same reasons sellers have. They still have cash, and as they scan the print and packaging segments for opportuni- ties, their motivation remains high. There are two kinds of buyers: strategic and financial. Those in the first group mostly are print and packaging firms looking to acquire other print and packaging firms for strategic reasons. These could include bringing in new volumes of business, in the form of acquired accounts, when organic growth has stalled; expanding into new geo- graphical territories; and adding technologies, products, and services that the acquiring firm does not have. Financial buyers are investors — financiers seeking a return on their investments in sectors where they see CONTINUED ON PAGE 22

Any slowdown in the pace of M&As among printing and packaging firms is only temporary. The industry is recov-

ering, buyers are flexible, and the fundamental forces that drive M&A activity are still in play. We haven’t arrived yet, but at least we know that there’s a “there” there — and that we’re closing the distance between ourselves and it. With a return to normal business The year 2020 put a serious damper on industry sales, although packaging firms generally fared bet- ter than commercial printing busi- nesses. The latest NAPCO Research/ PRINTING United Alliance COVID-19 Print Business Indicators Survey tells

Peter Schaefer

conditions in sight, we are already seeing a pickup in activ- ity for mergers and acquisitions in printing and packaging in 2021.

Paul Reilly

us that, toward the end of the year, more companies were starting to report upward trends in business activity than those reporting declines. Encouragingly, PRINTING United Alliance economists are holding to their projection of sales


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April 12, 2021

The Current Pace Of M&A (CONT’D FROM PAGE 20)

that they don’t want to keep sitting on the sidelines. We think that these trends will converge at some point this year in a renewed surge of M&A activity. Sellers Still Want To Sell It’s important to remember that many firms have not been negatively impacted by COVID. In fact, many pack- aging, label, and niche commercial printers have seen their sales and profits grow in the past year. These COVID winners are busy, and they’re enjoying great valuations right now. Many of the COVID wounded were bolstered by forgiv- able loans from the Small Business Administration’s Pay- check Protection Program (PPP), which received a second round of funding in January. These firms are planning on returning to the market after the current qualification pe- riod ends. Meanwhile, the availability of cheap and plentiful mon- ey for financing acquisitions is supporting solid multiples

that prospects for growth are good. Using both borrowed money and private capital, they seek out solidly perform- ing acquisition targets they believe they can make even more profitable; or that they can add to a platform of sim- ilar companies previously acquired. The highflyers in this group are the private equity (PE) firms: boutique investors with access to capital from high-net-worth individuals and other well-funded sources. Since COVID, we have been seeing some hesitancy on the part of strategic buyers, who are concentrating on getting their own houses in order as they try to determine what the recovery will look like and how the lending en- vironment might change. But many of these buyers have excess capacity to fill, and they know that they can’t post- pone acquiring new accounts indefinitely. The financial buyers, meanwhile, have a lot of money

— some of the best we’ve in the last 10 years. Proposed increases in capital gain rates are driving many sellers to close their deals before year-end. As strategic buyers who were reluc- tant to perform due diligence during COVID get back into action, we foresee a return to robust activity. Another positive sign is the flexibility that some buyers are showing in the way they structure deals with COVID-impacted sellers. In cases where the seller has recovered quick- ly, the buyer may be willing to remove the two or three months of poor results and plug in the same number of months from the pre-COVID year, so that there’s no penalty to the calcu- lation of selling price. (We call this EBITDAC: Earnings Before Interest, Taxation, Deprecia- tion, Amortization, and Coronavirus.) In the same spirit of accommodation, some buyers will acquire on the basis of 2020 num- bers and then wait to see if performance in 2021 rebounds to what it was in 2019. If this happens, the seller gets an earnout — in effect, a second paycheck — to make up the differ- ence between the initial selling price and the adjusted one. Hope In Distress We wish we could say that every printing business is looking at good options like these, but the sad fact is that for some of them, the damage done by the pandemic has been too severe. These firms have been staying open mostly by virtue of their PPP loans. Once that resource is exhausted, however, they will have some tough choices to make. Liquidating press equipment and other as- sets probably won’t be advisable, given that liquidation values currently are low. We think CONTINUED ON PAGE 24


April 12, 2021

The Current Pace Of M&A (CONT’D FROM PAGE 22)

this will lead to an uptick in opportunities for tuck-ins and cashless mergers once troubled owners realize there are alternatives to locking the doors and selling everything off. When done correctly, these transactions create value for buyer and seller alike, even if the seller is struggling. The Watchword Is Optimism A year ago, in a forecast published in these pages during some of the worst moments of the pandemic, we acknowledged that, in the short-term, we didn’t know what would happen — the upheaval to the economy had been too sudden, and it was too soon to measure the extent of the loss. We also said that as the threat of the virus started to fade, and the economy began to rebound, M&A activity would rebound along with it. We’re sticking by that prediction. Today we have vac- cines, hope, and a powerful pent-up desire to get back into the normal rhythms of business. The printing and packaging industries remain among the most highly frag- mented industries in the U.S., and fragmented industries inevitably consolidate through M&As. Owners of printing and packaging companies who are ready to move onto the next stages of their lives continue to search for profit- able exit strategies. We still don’t know exactly what will happen, but we’re confident that any slowdown in the pace of deal closings CONTINUED ON PAGE 38

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April 12, 2021

AICC Southeast Summit (CONT’D FROM PAGE 1 )

this month will feature speakers and topics to help mem- bers maintain consistency and excellence in serving their customers. Mitch Klingher, principal at Klingher-Nadler LLP in En- glewood Cliffs, New Jersey, keynoted the meeting with his presentation called “Looking Ahead at Market Forces,

of AICC’s online Packaging School, and greater member engagement on weekly membership Zoom calls, virtual plant tours, converter “think tank” sessions and the use of the All-Access Pass for education and training. He also shared details on the Foundation for Packaging Education, chartered in the fall of 2020 by AICC’s Board of Directors to raise funds for the continued growth and expansion of industry-specific training programs for employees in AICC member companies. As Regional Director for AICC’s Southeast Region, Ben DeSollar, President and CEO of Sumter Packaging in Sum- ter, South Carolina, chaired the meeting and as his first

task, introduced AICC Chairman Jay Carman, CEO of The Stand- Fast Group in Carol Stream, Illinois. Because AICC’s Board last fall de- ferred the normal election of officers and directors due to the COVID-19 pandemic, Carman is the first AICC Chairman to be serving a second

Mitch Klingher

Box Demand and How to Strategize.” In it he outlined the current state of the business: positive forces such as high box demand, record profits and elevated levels of capital investment in the industry. On the negative side he cited tightness in the containerboard market with rising prices, supply chain interruptions in basic materials, a shortage of

Jay Carman

year in the position. Carman thanked members for their support of the Association and commented on the phe- nomenal spike in demand the past year has placed on the industry. He said his company, as have many others, has struggled to keep up with customer demand and that AICC’s 2021 Spring Meeting in Amelia Island, Florida, later


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April 12, 2021

AICC Southeast Summit (CONT’D FROM PAGE 26)

and lighter weight containerboard. He provided a snapshot of the current North American paper market, especially the new capacity expected to be coming on stream in the next few years. Noting that nearly all of it is 100 percent re- cycled containerboard being made on machines convert- ed from other grades, most notably newsprint, Young said that converters will have an opportunity to source lighter

good employees, high-profile ransomware attacks on larg- er paper producers and, of course, the ongoing pandemic and its uncertainties. Klingher also looked at the effects of high-speed converting on the business as more machin- ery suppliers roll out equipment with shorter set-up times

Mitch Klingher, at podium, moderated a panel of four box makers. From left, Michael Drummond of Packrite, Ben DeSollar of Sum- ter Packaging, Gary Brewer of Package Crafters, and Howard Bertram of Complete Design and Packaging.

and faster running speeds. He urged members to educate themselves and their customers about using lighter weight containerboard as a way to reduce costs and improve per- formance. Ralph Young, AICC’s Technical Advisor, followed Kling- her’s presentation with some statistics on “rightweighting”

weights not previously available. Like Klingher, Young sees a greater value proposition for independents’ customers in understanding and using these grades. Michael Drummond, President and Owner of Packrite LLC, in nearby High Point, North Carolina, give a virtual


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April 12, 2021

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