Portola Packaging announces $12 million capital expenditure investment in closure business

  Portola Packaging announces $12 million capital expenditure investment in
                               closure business

PR Newswire

NAPERVILLE, Ill., Feb. 11, 2013

NAPERVILLE, Ill., Feb. 11, 2013 /PRNewswire/ -- Portola Packaging, Inc. is
announcing a $12 million capital expenditure in its Kingsport, Tenn. and
Tolleson, Ariz. facilities. The investment is being made to accommodate
growing market demand for its hot-fill and aseptic beverage closures and
increased dairy business market share.

Some of the new capital improvements are already under way, with completion
expected by the end of the third quarter. New investments are being made in
additional high-speed compression and injection molding equipment as well as
in existing production line upgrades. The company projects that approximately
30 production employees will be added to those locations when the increased
capacity is operational.

This investment comes on the heels of a previous substantial expenditure—also
in high-speed compression and injection molding capacity—made over the past
three years.

In line with Portola's ongoing objective to create more efficient,
cost-effective facilities and improve the environmental footprint, there also
will be infrastructure replacements and upgrades. These will include process
water capacity, hvac/dehumidification, electric power service and
distribution, resin delivery, etc.

Over the past three years, Portola has grown its beverage closure volume by
double-digit percentages annually. Manufacturing and quality initiatives,
coupled with new stock and custom closures for tamper evident, aseptic and
extended shelf-life applications are responsible for part of the
growth—particularly in the juice, dairy and specialty beverage market
segments.

"Our focus on lean manufacturing, reliability-centered maintenance, and
product rationalization has allowed us to increase unit throughput per
employee by 43 percent over the past four years. After the additional
capacity is fully operational, we expect to exceed a 75% improvement for the
same metric," saidKevin Kwilinski, president and chief executive officer,
Portola.

As a result of the decision to expand capacity at the Kingsport and Tolleson
facilities, Portola will begin tapering off production at its Batavia, Ill.
plant in the middle of April. The facility is expected to be completely shut
down no later than August. Geographic location of expected growth
opportunities and the level of investment which would have been needed to
upgrade this facility were factored into the decision. Affected are 76
employees.

"Our Batavia facility has been producing closures for Portola for the past 20
years. After extensive analysis and careful thought, we came to the
conclusion that closing this facility and upgrading production at our other
two plants was the best decision for our customers and company. We want to
thank our loyal Batavia production workers for their years of service and will
be assisting them via outplacement services so they can transition to their
next place of employment," Kwilinski said.

The Batavia facility also housed 15 corporate employees (engineering, quality,
research and development). That staff will join the rest of the corporate
employees in a new, larger corporate headquarters facility in the Naperville,
Ill. area.

"Our new and improved U.S. manufacturing footprint will effectively enable us
to service our existing customer base while providing a footprint for growth
over the coming years. Our Kingsport facility is located in the Northeast
corner of Tennessee and is in close proximity to major Northeast, Southeast
and Southern shipping lanes as well as a reasonable distance to the Midwest.
Our Tolleson location is located in the Phoenix metro area and will primarily
serve the Southwest, Northwest and Central U.S. states," Kwilinski concluded.

Going forward, Portola Packaging will operate nine manufacturing facilities
around the world: two in the United States, three in Canada and one each in
Mexico, the United Kingdom, Czech Republic and Russia.

About Portola Packaging
Portola Packaging, Inc. is a leading manufacturer of stock and custom
tamper-evident plastic closures and containers for dairy, juice and other food
segments. The company is known for its superior product integrity, technical
capability, global manufacturing footprint and speed-to-market. For more
info: www.portpack.com.

Media Contacts:
Sophia Dilberakis
SD Communications
+1 (312) 787-5800
sophiad@att.net

SOURCE Portola Packaging, Inc

Website: http://www.portpack.com