february 2014 - pmcf 3, 2014 — montagu private equity, a london-based investment firm, announced...

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PLASTICS & PACKAGING MONITOR FEBRUARY 2014 INSIDE THIS ISSUE Top News in PLASTICS & PACKAGING February 28, 2014 — The Association of Postconsumer Plastics Recyclers (APR) and the American Chemistry Council’s (ACC) Plastics Division released new data regarding the recycling of rigid plastics indicating significant growth for the sector. The recent success is due in part to the formation of APR’s Rigid Plastics Recycling Program in 2009, which established an organized effort to target recycling of rigid plastics. Rigid plastics is now the fastest growing category of plastics recycling as the group has worked to establish programs that provide more than 60% of Americans with access to rigid plastics collection programs. The research indicates that more than 1 billion pounds of rigid plastics was recycled in 2012, which is more than three times the levels achieved in 2007. The group hopes to continue on this success and implement new programs to encourage recycling of rigid plastics including non-bottle rigid plastics which have historically been recycled less. February 25, 2014 — Tech Molded Plastics, a Meadville, PA-based custom injection molder was named the Plastics News Processor of the Year during the Plastics News Executive Fo- rum held in Florida in February. Tech Molded Plastics won the award, which is sponsored by the Society of the Plastics Industry (SPI), over two other finalists, Riverside, CA-based AMA Plastics, Inc. and Cobourg, Ontario-based Protoplast, Inc. Also during the Executive Forum, Plastics News named three winners of PN Excellence Awards including DLH Indus- tries, Protoplast, and 20/20 Custom Molded Plastics. February 21, 2014 — Albéa Group, a global cosmetics packaging manufacturer, an- nounced an investment of approximately 30 million euros for two new production facili- ties in France and Italy. The new facilities will consolidate part of the Company’s current operations. The investment includes 22 million euros to merge its tube manufacturing operations in France into a new 23,000 square foot facility. The tube business accounts for approximately one third of Albéa’s 1.1 billion euros in total revenue, and the segment is expected to grow at an annual rate of 10% according to the Company’s President. Albéa will also replace two production facilities in Italy with a new 13,000 square foot facility. The Company reinvested approximately 8%-9% of its sales in 2013 as part of a global invest- ment strategy, which it expects to continue in 2014. February 7, 2014 — Dallas, TX-based market research and consulting firm Marketsand- Markets (M&M) released a new report on the global pharmaceutical packaging market which forecasts the segment to reach approximately $78.8 billion by 2018. According to the report North America, Europe, and Japan accounted for more than 70% of the entire market, which consists of plastic bottles, blister packs, caps and closures, ampoules, vials, and other pharmaceutical packaging products. The United States is the largest consumer of packaging for the segment while growth in the mature market is expected to be slightly less than the global average. The fastest growing market for pharmaceutical packaging is the Asia-Pacific region, which includes Japan, and is expected to grow at double-digit levels on average through 2018 to surpass the North American and European markets in total size. In terms of specific pharmaceutical packaging products, plastic bottles and blister packs account for the largest share of the market at approximately 35.8%; however, near-term growth for these products will be outpaced by pre-fillable syringes and inhalers, medication tubes, vials, labels, and accessories. February 4, 2014 — According to a report recently released by the Washington-based American Chemistry Council, linear low density polyethylene (LLDPE) sales grew approxi- mately 3.7% in Canada and the United States during 2013, accounting for the highest growth rate of the six commodity resins followed by the group. The study also noted poly- styrene posted the first positive growth since 2011, increasing 1.1% in 2013 driven pri- marily by increased use among consumer, industrial, and food packaging markets. Export sales were even stronger for LDPE and LLDPE in 2013, growing 11.8% and 12.0%, respec- tively, while exports declined significantly among PVC and polypropylene resins. Select Transactions in Plastics & Packaging Page 3 Plastics & Packaging Equity Valuation Page 4 Plastics & Packaging Transaction Statistics Page 5 www.pmcf.com JOHN HART Managing Director 248.223.3468 [email protected] MATT JAMISON Managing Director 248.223.3368 [email protected] RYAN SHUCHMAN Vice President 248.603.5372 [email protected] Sources: Plastics News, American Chemistry Council, Association for Postconsumer Plastics Recyclers, Pharmaceutical & Medical Packaging News, MarketsandMarkets, Company Websites

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Page 1: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

PLASTICS & PACKAGING MONITORFEBRUARY 2014

INSIDE THIS ISSUE

Top News in PLASTICS & PACKAGINGFebruary 28, 2014 — The Association of Postconsumer Plastics Recyclers (APR) and the American Chemistry Council’s (ACC) Plastics Division released new data regarding the recycling of rigid plastics indicating significant growth for the sector. The recent success is due in part to the formation of APR’s Rigid Plastics Recycling Program in 2009, which established an organized effort to target recycling of rigid plastics. Rigid plastics is now the fastest growing category of plastics recycling as the group has worked to establish programs that provide more than 60% of Americans with access to rigid plastics collection programs. The research indicates that more than 1 billion pounds of rigid plastics was recycled in 2012, which is more than three times the levels achieved in 2007. The group hopes to continue on this success and implement new programs to encourage recycling of rigid plastics including non-bottle rigid plastics which have historically been recycled less.

February 25, 2014 — Tech Molded Plastics, a Meadville, PA-based custom injection molder was named the Plastics News Processor of the Year during the Plastics News Executive Fo-rum held in Florida in February. Tech Molded Plastics won the award, which is sponsored by the Society of the Plastics Industry (SPI), over two other finalists, Riverside, CA-based AMA Plastics, Inc. and Cobourg, Ontario-based Protoplast, Inc. Also during the Executive Forum, Plastics News named three winners of PN Excellence Awards including DLH Indus-tries, Protoplast, and 20/20 Custom Molded Plastics.

February 21, 2014 — Albéa Group, a global cosmetics packaging manufacturer, an-nounced an investment of approximately 30 million euros for two new production facili-ties in France and Italy. The new facilities will consolidate part of the Company’s current operations. The investment includes 22 million euros to merge its tube manufacturing operations in France into a new 23,000 square foot facility. The tube business accounts for approximately one third of Albéa’s 1.1 billion euros in total revenue, and the segment is expected to grow at an annual rate of 10% according to the Company’s President. Albéa will also replace two production facilities in Italy with a new 13,000 square foot facility. The Company reinvested approximately 8%-9% of its sales in 2013 as part of a global invest-ment strategy, which it expects to continue in 2014.

February 7, 2014 — Dallas, TX-based market research and consulting firm Marketsand-Markets (M&M) released a new report on the global pharmaceutical packaging market which forecasts the segment to reach approximately $78.8 billion by 2018. According to the report North America, Europe, and Japan accounted for more than 70% of the entire market, which consists of plastic bottles, blister packs, caps and closures, ampoules, vials, and other pharmaceutical packaging products. The United States is the largest consumer of packaging for the segment while growth in the mature market is expected to be slightly less than the global average. The fastest growing market for pharmaceutical packaging is the Asia-Pacific region, which includes Japan, and is expected to grow at double-digit levels on average through 2018 to surpass the North American and European markets in total size. In terms of specific pharmaceutical packaging products, plastic bottles and blister packs account for the largest share of the market at approximately 35.8%; however, near-term growth for these products will be outpaced by pre-fillable syringes and inhalers, medication tubes, vials, labels, and accessories.

February 4, 2014 — According to a report recently released by the Washington-based American Chemistry Council, linear low density polyethylene (LLDPE) sales grew approxi-mately 3.7% in Canada and the United States during 2013, accounting for the highest growth rate of the six commodity resins followed by the group. The study also noted poly-styrene posted the first positive growth since 2011, increasing 1.1% in 2013 driven pri-marily by increased use among consumer, industrial, and food packaging markets. Export sales were even stronger for LDPE and LLDPE in 2013, growing 11.8% and 12.0%, respec-tively, while exports declined significantly among PVC and polypropylene resins.

Select Transactions in Plastics & Packaging Page 3

Plastics & Packaging Equity Valuation Page 4

Plastics & Packaging Transaction Statistics Page 5

www.pmcf.com

JOHN HARTManaging Director [email protected]

MATT JAMISONManaging Director [email protected]

RYAN SHUCHMANVice President [email protected]

Sources: Plastics News, American Chemistry Council, Association for Postconsumer Plastics Recyclers, Pharmaceutical & Medical Packaging News, MarketsandMarkets, Company Websites

Page 2: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

John HartManaging Director, Plastics & Packaging

Matt JamisonManaging Director

About PMCFP&M Corporate Finance (“PMCF”) is an investment banking firm, focused exclusively on middle market transactions, with professionals in Chicago, Detroit, and across the globe through Corporate Finance International associates. Our dedicated Plastics & Packaging Group has extensive industry knowledge and covers a wide range of processes including thermoforming, extrusion, blow molding, injection molding, resin, and color & compounding. Offering a depth of advisory services, the Plastics and Packaging Group has helped clients worldwide meet their sale, acquisition, financing, and strategic growth objectives.

Investment Banking Services:

• Mergers and Acquisitions • Strategic Assessments• Sales and Divestitures • Sale Planning • Capital Raising

CHICAGO225 W. Washington St., Suite 2700

Chicago, IL 60606312.602.3600

DETROIT26300 Northwestern Highway, Suite 120

Southfield, MI 48076248.223.3300

This market overview is not an offer to sell or a solicitation of an offer to buy any security. It is not intended to be directed to investors as a basis for making an investment decision. This market overview does not rate or recommend securities of individual companies, nor does it contain sufficient information upon which to make an investment decision.

P&M Corporate Finance, LLC will seek to provide investment banking and/or other services to one or more of the companies mentioned in this market overview.

P&M Corporate Finance, LLC, and/or the analysts who prepared this market update, may own securities of one or more of the companies mentioned in this market overview.

The information provided in this market overview was obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. It is not to be construed as legal, accounting, financial, or investment advice. Information, opinions, and estimates reflect P&M Corporate Finance, LLC’s judgment as of the date of publication and are subject to change without notice. P&M Corporate Finance, LLC undertakes no obligation to notify any recipient of this market overview of any such change.

The charts and graphs used in this market overview have been compiled by P&M Corporate Finance, LLC solely for illustrative purposes. All charts are as of the date of issuance of this market overview, unless otherwise noted.

The PMCF Plastics Index may not be inclusive of all companies in the plastics industry and is not a composite index of the Plastic industry sector returns. Index and sector returns are past performance which is not an indicator of future results.

This market overview is not directed to, or intended for distribution to, any person in any jurisdiction where such distribution would be contrary to law or regulation, or which would subject P&M Corporate Finance, LLC to licensing or registra-tion requirements in such jurisdiction.

Page 3: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

Plastics & Packaging Monitor – February 2014

P&M Corporate Finance, LLC

3

Select Transactions in Plastics & Packaging

Featured Transaction – Marquee Deal

February 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations from Rexam plc’s Healthcare Division for approximately $805 million. The sale, which accounts for two thirds of Rexam’s Healthcare Division, does not include the healthcare closures and containers operations.

Rexam has been in discussions to sell its Healthcare operations for the past year as the company aims to focus on its cans business. Upon completion of the deal, Rexam shareholders will receive ap-proximately £450 million through a redeemable B share scheme along with a share consolidation.

Montagu Private Equity has experience dealing with Rexam and in operating medical and healthcare companies, having previously owned Risdon Pharma, which it sold to Rexam in 2003.

Featured Transaction – Marquee Deal

February 6, 2014 — Plymouth, MI-based Plastipak Packaging, Inc. announced it has reached an agreement to acquire the U.S. assets of Constar International Holdings, LLC for $102.5 million after a bidding war following the Company’s December bankruptcy filing.

Constar, based in Trevose, PA, filed for Chapter 11 bankruptcy pro-tection from creditors in December 2013 and received a stalking horse bid from Amcor, Ltd., an Australian packaging company with a North American headquarters based in Ann Arbor, MI. Amcor is North America’s largest blow molder according to the most recent Plastics News data.

Plastipak, which ranked third among North American blow molders prior to the transaction, has sales of $1.65 billion across 13 plants. The Constar U.S. assets include six plants and approximately $190 million in annual sales.

Film

Date Buyer Target Industry/ Application

Enterprise Value ($mm) EV/EBITDA

Sheet & Thermoforming

Specialty Processes (Rotomolding, Form, Profile Extrusion, & Other)

Injection Molding

Blow Molding

Resin and Color & Compounding

4-Dec-139-Dec-139-Dec-1321-Dec-1322-Jan-1422-Jan-143-Feb-144-Feb-145-Feb-1410-Feb-1427-Feb-1428-Feb-14

Saint-Gobain Performance Plastics CorporationFlorida Capital Partners, Inc.; PNC RiverArch CapitalRPC Group PLCWeener Plastik AGBerry Plastics Group, Inc. (NYSE:BERY)RTI International Metals, Inc. (NYSE:RTI)Montagu Private Equity LLPGardner Denver Inc.Res-Tech CorporationContiTech AGMattel, Inc. (NasdaqGS:MAT)Mayhew Steel Products, Inc.

LS Kunststofftechnologie GmbHCustom Molded Products, Inc.Helioplast dooWeener Empire Plastics India Joint VentureQINGDAO P&B Co., Ltd.RTI Directed Manufacturing, Inc.Rexam's Pharma Devices & Prescription Retail Pkg. DivisionConroe Plastics Molding, Inc.Northeast Mold & Plastics, Inc.Veyance Technologies, Inc.MEGA Brands Inc. (TSX:MB)Basque Plastics, LLC

AutomotiveConsumer

Food & BeverageConsumer

Food & BeverageAutomotive

MedicalIndustrialElectronicsAutomotiveConsumerConsumer

--

13.8--

23.0805.0

--

1400.0448.7

-

----------

9.6x-

16-Dec-1319-Dec-138-Jan-1423-Jan-146-Feb-1414-Feb-14

RPC Group plc (LSE:RPC)Scandia Plastics, Inc.Logoplaste Consultores TecnicoCéréa Partenaire; CHEMARK Kft.; BPI France SAPlastipak Packaging, Inc.Robinson plc (AIM:RBN)

Maynard & Harris Group LimitedParadigm Packaging, Inc.Seda de Barcelona-PackagingChesapeake's Specialty Chemical Packaging DivisionConstar International LLCMADROX Spolka Jawna

MedicalMedical

Food & BeverageIndustrial

Food & BeverageConsumer

168.8-

237.6-

102.522.1

6.7x-----

9-Dec-1316-Dec-1317-Dec-1320-Dec-1331-Dec-136-Jan-1416-Jan-1428-Jan-1431-Jan-146-Feb-1412-Feb-1419-Feb-14

Citadel Plastics Holdings, Inc.OpenGate Capital, LLCBraskem S.A. (BOVESPA:BRKM5)OpenGate Capital, LLCA. Schulman, Inc. (NasdaqGS:SHLM)Capiton AGSolvay America, Inc.Kraton Performance PolymersTeknor Apex CompanyCapital Partners, Inc.Ravago Petrokimya Uretim A.S.Uniform Color Company, Inc.

Lucent Polymers, Inc.Solvay Benvic Europe - Iberica, S.A.Solvay Indupa S.A.I.C. (BASE:INDU)Kem OnePrime Colorants Inc.Dynea Erkner GmbHPlextronics, Inc.LCY Chemical-Styrenic BlockViking Polymers, LLCEast Coast Colorants, LLCTekpol Teknik Poliuretan San. Ve TIC. A.S.BASF SE, Liquid Masterbatch Business in Clermont de l'Oise

IndustrialIndustrialIndustrialIndustrialIndustrialIndustrialElectronicsIndustrialIndustrialIndustrialIndustrialIndustrial

--

235.6-

15.1-

40.2695.9

--

49.0-

--

4.5x---------

11-Dec-1323-Dec-1313-Jan-1421-Jan-1414-Feb-14

Scholle Packaging, Inc.Pall Corporation (NYSE:PLL)The InterFlex Group, Inc.CCL Industries Inc. (TSX:CCL.B)Pro-Pac Packaging (Aust) Pty Ltd.

IPN Europe BVAtmi LifeSciencesStar Packaging CorporationSancoa and TubeDecAustralian Film Manufacturers Pty Ltd.

Food & BeverageMedical

Food & BeverageConsumer

Food & Beverage

-185.0

-71.0

-

---

7.0x-

16-Dec-138-Jan-143-Feb-1427-Feb-14

Universal Plastics CorporationSIMONA AMERICA Inc.EQT Partners ABLippert Components, Inc.

Mayfield Plastics, Inc.Laminations Inc.Færch Plast A/SStar Design, LLC

MedicalIndustrial

Food & BeverageTransportation

---

12.3

----

13-Dec-1310-Jan-1423-Jan-1424-Jan-1413-Feb-1417-Feb-1419-Feb-1424-Feb-1425-Feb-14

3D Systems Corp. (NYSE:DDD)Mitsui Matsushima Co., Ltd. (TSE:1518)Grey Mountain Partners, LLCContinental Commercial Products, L.L.C.Indiana Rotomolding Inc.WERU GmbHRototek LiimtedMasonite International Corporation (NYSE:DOOR)KP Building Products, Inc.

Village Plastics, Inc.NIPPON STRAW Co., Ltd.Dimex LLCFTW Holdings, Inc.El Monte Plastics LLC.UNILUX AGImagenta Moulding Plc, Rotational Moulding BusinessDoor-Stop International LtdFarley Group Inc.

IndustrialFood & Beverage

ConsumerIndustrial

TransportationConstructionIndustrial

ConstructionConstruction

-29.4

-11.5

---

50.0-

--------- Source: CapIQ,

Company Reports

Page 4: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

Plastics & Packaging Monitor – February 2014

www.pmcf.com

4

Plastics & Packaging Equity Valuation

Source: Capital IQ ^Based on available Capital IQ Analyst summaries

Performance of PMCF Indices vs. S&P 500 PMCF Key Takeaways and Analysis• The Diversified component is now leading the PMCF Index,

trading at 9.5x EBITDA, having increased by a half turn over the past month

• The Color & Compounding component of the Index was the only segment to decline versus levels in January, falling from 10.4x to 8.9x EBITDA. The decline was driven by Ferro Corp., which decreased significantly from a heightened valuation in January while the rest of the sector increased in value

• The Mid-Sized, Color & Compounding, and Diversified com-ponents of the PMCF Index each outperformed the S&P 500 during the three month period ending February 28th. The Diversified component experienced the strongest growth dur-ing February, increasing by approximately 10.1%.

Income Statement data as of last period date reported. Currency conversion rate as of 2/28/2014

Company Name Symbol LTMRevenue

LTMEBITDA

Market Cap

Price/Earnings Current 3 Year

AverageProjected Next FYE^

Financials / Metrics ($mm) (2/28/2014) EV / EBITDA Multiples

Large Packaging (Large)

Large Average

Mid-Size Packaging (Mid)

Mid-Size Average

Color & Compounders (C&C)

C&C Average

Diversified and Industrial Plastics (Diversified)

Diversified Average

Amcor Ltd.

AptarGroup, Inc. Avery Dennison Corp.Bemis Co. Inc. Berry Plastics GroupRexam plc Sealed Air Corp. Silgan Holdings Inc. Sonoco Products Co.

ASX:AMC NYSE:ATR NYSE:AVY NYSE:BMS NYSE:BERY LSE:REX NYSE:SEE NasdaqGS:SLGN NYSE:SON

$11,703 2,520 6,140 5,030 4,715 6,532 7,691 3,709 4,848

$ 5,876

$1,352 446 628 618 755 921

1,018 508 584

$ 759

$10,901 4,336 4,783 3,995 2,837 6,508 7,290 3,057 4,280

$ 5,332

18.9x26.3x20.4x19.3x40.4x15.6x77.4x16.8x19.8x28.3x

10.5x10.2x

8.7x8.6x8.8x9.2x

10.5x9.1x8.5x9.3x

10.6x8.9x7.5x7.8x8.5x7.4x8.2x8.8x7.5x8.3x

NA9.9x

NANANA

8.3x9.4x

NA8.6x9.0x

AEP Industries Inc.

CCL Industries, Inc.Multi-Color Corp.RPC Group plc Tredegar Corp.Winpak, Ltd.

NasdaqGS:AEPI TSX:CCL.B NasdaqGS:LABL LSE:RPC NYSE:TG TSX:WPK

$1,149 1,779

681 1,768

959 715

$1,175

$48 319 111 192 100 133

$ 151

$239 2,822

555 1,724

805 1,520

$1,278

22.2x30.4x16.2x38.9x22.6x22.0x25.4x

7.5x10.7x

8.5x10.1x

8.9x10.7x9.4x

8.0x7.1x8.5x7.9x7.2x7.6x7.7x

NA10.5x

NANANA

9.9x10.2x

A. Schulman, Inc.Clariant AGCytec Industries, Inc.Ferro Corp.PolyOne Corp.

NasdaqGS:SHLM SWX:CLN NYSE:CYT NYSE:FOE NYSE:POL

$2,187 6,823 1,935 1,635 3,771

$3,270

$129 876 396 203 391

$399

$1,012 6,519 3,378 1,138 3,554

$3,120

30.4xNMNM

14.3x38.7x27.8x

9.0x8.6x

10.0x7.0x

10.0x8.9x

7.3x6.2x8.5x8.8x8.2x7.8x

NA8.9x

NA10.2x

NA9.5x

Axiall CorporationCore Molding Technologies, Inc.Essentra plcIntertape Polymer Group, Inc.Jarden Corp.Myers Industries, Inc.Plastic Omnium SASimona AG

NYSE:AXLL AMEX:CMT LSE:ESNT TSX:ITP NYSE:JAH NYSE:MYE ENXTPA:POM DB:SIM

$4,666 144

1,322 782

7,356 825

6,479 370

$2,743

$693 15

259 96

853 88

623 29

$ 332

$2,830 110

3,471 702

7,907 728

5,078 262

$2,636

16.6x15.0x34.6x35.6x34.7x28.3x21.0x20.8x25.8x

6.1x7.2x

14.6x9.3x

15.2x8.3x8.7x6.5x9.5x

7.8x4.4x

11.4x8.5x9.3x7.4x5.2x5.8x7.5x

6.5xNA

13.7x7.8x

10.6x7.3x5.9x

NA8.7x

Feb-12Feb-11

May-11

Aug-11Nov-1

1Feb-14

May-12

Aug-12Nov-1

2Feb-13

May-13

Aug-13Nov-1

3

S&P 500Large Mid C&C Diversified

50%

100%

150%

200%

250%

300%

Page 5: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

Plastics & Packaging Monitor – February 2014

www.pmcf.com

5

2227

128

13

1923

21

12

106

2

2

3

64

5

6

10 5

2

3

5

3

76

322

8

4

34

42

38

16

13

21

28

3432

21

23

4

6

33

13

4

9

26

Aug 13 Sep 13 Oct 13May 13 Jun 13 Jul 13

2419

3

3

6

5

33

27

Dec 13 Jan 14 Feb 14Dec 12 Jan 13 Feb 13 Mar 13 Apr 13

1,011Strategic Financial Add-on Financial Platform

0

5

10

15

20

25

30

35

40

45

50

Nov 13

17

6

9

32

Plastics & Packaging Transaction Statistics

Plastics & Packaging Transactions (Dec ‘12 – Feb ‘14) Transactions by End Market

PMCF Key Takeaways & AnalysisTransaction volume for the Plastics and Packaging industry from December 2013 through February 2014 was characterized by the following trends as compared to December 2012 to February 2013:

• Overall plastics and packaging transaction volume for the three month period was slightly lower by two transactions as deal flow rebounded from weaker January M&A activity with a strong month in February

• Deals involving plastics and packaging suppliers to the food & beverage, automotive, and transportation end markets each increased versus the comparison period, while electronics and consumer transactions each remained flat year over year

• Transaction mix among strategic and financial buyers shift-ed as strategic buyers were more active from December 2013 through February 2014, increasing by 4 deals to 65 transac-tions, and 69% of deal volume versus 64% in the comparison period

• Overall packaging M&A activity was slightly higher from December 2013 to February 2014, increasing by 1 transaction versus the comparison period. Bottle packaging M&A supported the growth with an increase of 6 transactions. Packaging deals accounted for approximately 28% of plastics and pack-aging deals, slightly higher than the 26% experienced in the comparison period

• Resin and color & compounding transactions posted the larg-est increase in total deal activity by processor type, growing by 8 deals versus the comparison period, while blow molding and injection molding deals also increased

• Distressed transactions experienced an increase in deal vol-ume, increasing by 4 deals compared to the previous period, despite only one distressed deal during the month of February

Source: P&M Corporate Finance

Transactions by Process Type

Packaging Transaction Detail

Distressed Transaction Detail

Dec ‘12 - Feb ‘13 Dec ’13 - Feb ‘14

Packaging DetailDec 12-Feb 13

Dec 13-Feb 14

% of Total

% of Total

Rigid Packaging

Flexible Packaging

Bottles

Total

13

10

2

25

52.0%

40.0%

8.0%

100%

38.5%

26.9%

30.8%

100%

11

7

8

26

% of Total

% of Total

Distressed 1 1.0% 5 5.3%

Dec 12–Feb 13

Dec 13–Feb 14

Blow Molding11%

Injection Molding

32%

Film8%

Specialty17%

Resin/Color & Compounding

27%

Sheet &Thermoforming

5%

Blow Molding7%

Injection Molding

29%

Film17%

Specialty22%

Resin/Color & Compounding

18%

Sheet &Thermoforming

7%

Page 6: FEBRUARY 2014 - PMCF 3, 2014 — Montagu Private Equity, a London-based investment firm, announced it has acquired the Pharmaceutical Devices and Prescription Retail Packaging operations

JOHN D. HART Managing Director 248.223.3468 [email protected]

JAMES R. PETERSEN Associate [email protected]

RYAN R. SHUCHMAN Vice President 248.603.5372 [email protected]

DANIEL M. RATLIFF Analyst [email protected]

MATTHEW G. JAMISON Managing Director 248.223.3368 [email protected]

SCOTT S. ROHLIG Analyst [email protected]

www.pmcf.com

PLASTICS & PACKAGING TRANSACTION UPDATE

PMCF ANNOUNCES SALE OF FORT WAYNE PLASTICS INC. TO KATY INDUSTRIES INC.P&M Corporate Finance (PMCF) is pleased to announce that it served as the exclusive financial advisor to private equity investors Ferro Management Group, Inc. (Ferro) in the sale of its portfolio company Fort Wayne Plastics Inc. (FWP) of Fort Wayne, Indiana. The buyer was Katy Industries Inc. (Katy (OTCPK: KATY)), a leading designer, manufacturer and distributor of sanitary maintenance supplies, professional cleaning products and consumer products. The acquisition blends the extensive technical expertise of FWP with the well-established brand name and market leading position of Katy, and its sub-sidiary Continental Commercial Products. Specifically, the combination supports Katy’s strategy of expanding its structural plastic manufacturing capabilities. Katy is a portfolio company of private equity firm Kohlberg and Company.

With a history that spans over 40 years, FWP is a significant player within the structural plastic space and specializes in the manufacture of medium- to large- sized molded plastic components, utilizing low pressure, multi-nozzle structural plastic and gas assist technologies in its manufacturing process. FWP’s diverse capabilities, additive second-ary offerings and full-service approach established its leading position to a customer base that requires engineered components and assemblies for applications in water filtration, agriculture, recreation, medical, automotive, building products and a variety of other end markets.

“The sale of Fort Wayne Plastics to Katy was the ideal scenario for Ferro Management Group,” said Markus Isenrich, Ferro’s founder and President. “Our investors are thrilled with the outcome of this transaction. We are proud to have played a small part in the storied history of Fort Wayne Plastics and are confident the company will continue to thrive under new ownership.”

Ferro hired PMCF to lead the sale process for the FWP. Mr. Isenrich noted, “PMCF was critical to the success of this transaction. They understood the business and plastics market dynamics and effectively communicated the right story to ensure a successful outcome for Ferro and FWP. Their consultation and investment banking expertise was instrumental in completing this transaction. I would highly recommend the PMCF team.”

The transaction closed on February 19, 2014.

PMCF ANNOUNCES RECAPITALIZATION OF PLASTIC MEDICAL MANUFACTURER COMARP&M Corporate Finance (PMCF) is pleased to announce that it served as the exclusive financial advisor to Comar, Inc. (Comar), of Buena, NJ in a successful recapitalization with Graham Partners (Graham) of Newtown Square, PA. The transaction, and Graham’s partnership with Comar’s management, will provide access to additional capital and re-sources to support Comar’s global expansion plans and further broaden the Company’s product development and manufacturing capabilities in North America.

Comar’s shareholders selected PMCF’s Plastics & Packaging Group, led by John Hart, to serve as financial advisor for the recapitalization. Comar President Mike Ruggieri noted, “PMCF was instrumental to the success of this transaction. They have been a trusted and committed advisor to Comar for over 5 years. We relied on John and his team to execute our successful acquisition strategy and knew they were the right choice when we sought to bring in a financial partner. They are clearly plastic and packaging industry experts and guided us through every step of the transaction process. We would highly recommend PMCF to other companies considering an acquisition or sale.” PMCF is continuing to assist the Company in pursuing acquisition candidates in North America and Europe.

For more information v is i t www.pmcf.com