September 28, 2016
Like many of you, I have been reading the trade press reports of the number of acquisitions of independents going on in our industry. One report called it “a new gold rush in the North American containerboard market.”
I’ve written two or three articles in the past year about the acquisitions of independents. A recent Pulp & Paper Week article lists 31 such acquisitions from 2014 through July of 2016. Twenty-five of these were active AICC members—a number that causes some people to ask me if I’m worried about the future of the Association or the future of independents generally. My response is always the same: “No!” Why?
First, acquisitions of independents have been happening as long as there have been independents. In fact, if you think about it, our industry was practically all “independent” before the vertical integration trends which began more than 60 years ago. I haven’t been around the industry that long, but in my short tenure of 33 years I can remember long-established independents like J & J, Tate Containers, O’Grady Containers, Target Container, Lux Packaging, Triangle Container, and United Container & Display being bought out. Every decade seems to bring another wave. To me, this is a sign of a healthy industry as successful companies seek to grow by acquiring other well-run companies, or seek to add strategic capability to that which they already have.
Second, ownerships change because people age and retire, and these owners have the rightful desire to reap the benefits of their many years of work in building up a business. “Cashing out” isn’t a bad thing.
Third—and this is the point of this article—for every acquisition we read about in the trade press headlines, there are those privately held companies still working and serving the industry over multiple generations. I was reminded of this last month as I toured just one part of AICC’s regional network—the Pacific Northwest. There, Commencement Bay Corrugated in Orting, Wash., has in its ownership structure the Nist family, now six generations in the box business in the Seattle-Tacoma market. DeLine Box is a fourth-generation corrugator in Denver, now headed by David DeLine. We can point to many examples across the country: New England Wooden Ware in Gardner, Mass., six generations; Wunderlich Fibre Box in St. Louis, more than 150 years in business in the Wunderlich family. And Weber Packaging & Display, Philadelphia, soon to celebrate its 125th anniversary and the Doherty family’s 25th year of ownership of the company.
So, while we all focus on who’s being acquired, let’s not forget those still here who are still working as successful independent entities, serving their customers, their associates, and their communities for many generations and, we hope, many more to come.
Steve Young
President, AICC
