Spartech soaking up new business in the bath and spa segment

Bath and spa manufacturer Maax Inc. is exiting the sheet manufacturing business, to the benefit of Spartech Corp. Spartech will purchase three extrusion lines from Maax, and has secured a five-year contract to supply co-extruded sheet to Maax facilities across North America. The contract represents approximately 7 million lb. of new business for Spartech.

One extrusion line will be installed at Spartech Plastics’ plant in Granby, QC, and that plant will become the principal point of supply to Maax. Components of the other two lines will be used in various Spartech facilities in North America.

Richard Garneau, Maax’s CFO and executive vice-president, says space constraints and freight costs were key factors in the decision to discontinue in-house sheet production at the Ste. Marie, QC plant. Staff employed on the extrusion operations will be re-assigned within Maax.

In Granby, jobs will added to manage the new line, a Welex co-extrusion system which is expected to operate 24 hours a day, reports David Pocost, executive vice-president, extruded sheet, Spartech Corp. The line will produce co-extruded sheet of high-impact polystyrene capped with a clear styrene polymer.

This is one of several outsourcing agreements for Spartech. The company has identified outsourcing for current captive producers of plastic products as a cornerstone of its growth plans.

“We have recently established a cross-functional outsourcing team that will be targeting businesses which currently produce their own plastic materials, but where such operations are not core to their business models,” explains Spartech chairman, president and CEO Bradley B. Buechler. The company has also recently signed agreements with MTD and Whirlpool. Spartech has 45 facilities in North America and Europe, producing engineered thermoplastics, compounds, molded products and extruded sheet and profiles.

Speaking of strategy, Maax is back in the acquisition game after a two-year hiatus. The company has signed an agreement to purchase Aker Plastics Inc., the third largest U.S. manufacturer of fibreglass bathroom equipment. Maax is also doing well in terms of sales, with results for the quarter ended May 31, 2002, showing growth of 20% compared with the same period last year. The growth is attributed to an intense product deployment strategy across North America, and new spa contracts. Net income for the quarter increased 44% compared with last year.