Phoenix Packaging Corporation

The Partnership made an investment in Phoenix Packaging Corporation (Phoenix) in December 1997.  The proceeds of this investment were used to buy out an existing equity investor and to finance a portion of the acquisition of the assets of Northern Can Systems (Northern) from the Sequa Corporation.  In 1993, Michael Dubilier led an investor group that helped form Phoenix.

The Partnership sold its stake in Phoenix to Sonoco Products Company (Sonoco) on September 14, 2001.  The 1993 investor group and the Partnership received a blended internal rate of return (IRR) of 33 percent.

Phoenix is a manufacturer of easy-opening and pour-opening lids for the food and nutrition markets.  In December 1997, the company acquired Northern, a competitive manufacturer of easy-opening and pour-opening lids also used for the food and nutrition markets. The company’s headquarters and manufacturing facilities are located in the greater Canton, OH area.

In 1993, following the acquisition of Central States Can (Central States) by Crown Cork & Seal, George Smart and a team of former managers from Central States founded Phoenix Packaging.  Phoenix was subsequently formed with an equity investment by management, the Ball Corporation, several Canton area individuals, and an investor group led by Michael Dubilier. Northern was a non-core subsidiary of the Sequa Corporation, a public company with revenues exceeding $1.4 billion.  In September 2001, the company was bought by Sonoco and now operates under the name Sonoco-Phoenix Inc.

Phoenix capitalized on the change in market momentum away from sanitary lids toward easy-open lids.  The company increased market share, both organically and through the Northern acquisition, by maintaining and improving its excellent reputation for superior quality and customer service.  Management’s extensive experience in the industry and the company’s focus on the high growth and margin segments of the specialty packaging industry also contributed to the company’s success.

---