GRAND RAPIDS — A deal to acquire a New Jersey firm positions Praxis Packaging Solutions Co. to expand on the East Coast and diversify from its stronghold with pharmaceutical customers.
In the acquisition of Unette Corp., the Grand Rapids-based Praxis, a packaging and tablet-filling company, hopes to capitalize on the robust drug industry in New Jersey and also expand packaging services to include liquid, cream and paste products in various containers.
The transaction — the first for Praxis — closed on Nov. 9. Terms of the deal were not disclosed.
“Praxis has been wanting for some time to expand,” Scott Hanmer, senior vice president of Praxis, told MiBiz. “Unette was on our radar, and we capitalized on it. We plan to expand in both (locations). They are comparable, yet different in what they offer.”
The Randolph, N.J.-based Unette offers tube products that include cosmetics, personal care, food and pharmaceuticals, to name a few. It will operate under the moniker Unette: Powered by Praxis.
“It’s nice because their philosophy is similar to ours — customer-centric,” said Hanmer, adding that while Unette offers filling capabilities, Praxis specializes in secondary packaging, which does not directly contact products.
Unette had been owned by the husband-and-wife team of Joe and Carol Ann Hark, who sought to transition out of the business, according to Hanmer.
“They were looking for a new direction,” he said.
Already, Praxis is expanding in West Michigan. On Dec. 1, the company starts a lease on 30,000 square feet of space in a facility at 7357 Expressway Drive SW, located across 76th Street from its 200,000-square-foot plant on Caterpillar Court in Byron Township.
“The purpose of the space will be to support the growing operation in Grand Rapids and also to engage capabilities/technology from the Unette acquisition,” Hanmer said.
Additionally, Praxis will use Unette’s 115,000-square-foot New Jersey facility to accommodate packaging and filling lines.
In the deal, Praxis gains an important exposure to the East Coast, as well as diversifies its markets, Hanmer said.
“New Jersey is the epicenter of the pharmaceutical industry. It’s a nice balance to our drug connection,” said Hanmer, who noted that Praxis had targeted Unette before making the acquisition.
According to the New Jersey Economic Development Authority, the state is home to operations for 13 of the 20 largest pharmaceutical manufacturers, ranging from Johnson & Johnson to Bayer Healthcare.
Hanmer used shampoo as an example of how Praxis and Unette will complement each other, eliminating the steps it takes to package products.
“We are going to make the shampoo and then (package it),” he said.
With the acquisition, Praxis now employs 750 people, including more than 500 people at its Grand Rapids plant. Praxis also has a satellite plant in Columbus, Ohio. Hanmer declined to speculate on how the deal would affect the company’s headcount in New Jersey.
Since 1989, Praxis has been offering secondary packaging services, much of which ended up in big-box stores. Praxis operates as a portfolio company of the Huizenga Group, a diversified Grand Rapids-based private investment firm that bought the company a decade ago.
“The Huizenga Group recognizes our growth, (and we) are pursuing an active growth strategy,” Hanmer said. “We’re expanding our position and growing since the ownership from the Huizenga Group.”
The future for Praxis features three projects involving blending and filling, primary packaging and tablet fill, and serialization.
Blending and filling converts raw ingredients before the product is filled in a tube or container, while serialization practices reduce the chances of pills being counterfeited, Hanmer said.
“It is significant for Praxis as it provides an opportunity for vertical integration, all thanks to the Unette Corporation,” Hanmer said.
The demand for pharmaceutical packaging in the United States is rising. According to a study from Cleveland-based Freedonia Group, product demand in the $19.9 billion pharmaceutical packaging industry will increase 5.1 percent yearly over the next four years.
“Parenteral containers will post the fastest growth in primary pharmaceutical packaging, with prefillable syringes offering the best gains. Blister packaging and conventional plastic bottles will divide demand for oral pharmaceutical containers,” according to the study.
To package pharmaceuticals, Praxis is compliant with the U.S. Food and Drug Administration, International Society for Pharmaceutical Engineering and the Drug Enforcement Agency. At Praxis, Hanmer said the workplace is fast-paced and data-driven, and the company often rearranges its schedule every 24 hours.
That’s a part of the job Hanmer enjoys most.
“There are new opportunities every day,” he said. “We are surrounded by a great team, a great environment.”
Made in Michigan: Grand Rapids-based Praxis Packaging Solutions is expanding to the East Coast after acquiring Unette Corp. Praxis, a packaging and tablet-filling company, supplies secondary packaging for big-box stores, and baby food and pharmaceutical manufacturers. Praxis closed on the deal for the New Jersey-based company on Nov. 9.