By Jim Johnson
SENIOR STAFF REPORTER
Published: January 21, 2014 4:21 pm ET
Updated: January 21, 2014 4:22 pm ET
CCL Industries Inc. is making a $71 million push deeper into the personal care label and tube business with the purchase of a pair of companies with common ownership.
Toronto-based CCL expects to close a deal during the first quarter of this year for Sancoa and TubeDec, companies principally owned by Joe Sanski in New Jersey.
Sancoa and TubeDec had combined sales of $82.5 million last year and earnings before interest, taxes, depreciation and amortization of about $10.1 million, CCL Industries said.
The purchase price includes both money paid to the owners as well as assumption of debt. CCL declined to provide a breakdown when announcing the deal.
“It’s a very good strategic fit for CCL because we’re in the label and tube business much like Sancoa,” said Sean Washchuk, CCL chief financial officer, in a telephone interview. He also cited “the outstanding quality and reputation of the company.”
“We’ve known Joe Sanski for a long time and he’s known us. Joe wanted a legacy for his business and for his team and he wanted a good home for that business,” the CFO said. “It was just a mutually agreed upon transaction.”
CCL is attracted to the deal because of some similarities in the markets that both firms serve.
“Our tube business and a big chunk of our label business, not all of it, is in the personal care space. And all of Joe’s business, both the label and the tube, is in personal care as well,” Washchuk said.
News of CCL’s deal for Sancoa and TubeDec came just a day after CCL also said it was increasing its interest in Acrus-CCL, a wine label company in Chile. CCL spent $1.2 million for an additional 12.5-percent stake in the firm and now owns 62.5 percent of that operation.
CCL, with approximately 10,000 workers, has 89 production facilities in 25 countries. And acquisitions have played a major role in the company’s growth, especially recently.
It was just about a year ago that the company indicated it had approximately 6,600 employees and 74 production facilities around the world.
Since that time, acquisitions included a $500 million deal for Avery Dennison’s office and consumer products and designed and engineered solutions businesses.
“We look to acquire companies at attractive multiples that fit strategically with our business. We try to remain to our core strategic view that we want to buy companies that are in the label industry or adjacencies to it. We’re looking for companies that expand our geographic reach, our technical expertise and our customer base,” Washchuk said.
CCL is not talking about financial particulars, at this point, beyond the purchase and EBITDA numbers. But CEO Geoffrey T. Martin had this to say in a statement: “We expect to unlock many financial and operational synergies which we will announce in more detail at the closing of the transaction later this quarter."
Sanski and the management team at Sancoa and TubeDec are joining CCL, the company said.
Sancoa has corporate headquarters in Lumberton, N.J., where its principal label production also is situated within the location’s 160,000 square feet. TubeDec, with extrusion and side seam tube operations, is located at a 60,000-square-foot site in Moorestown, N.J., according to the company’s website. | 
