Trading alliance heads south as Chesapeake enters Spanish market

By Wai Lang Chu

- Last updated on GMT

Related tags: Bankruptcy

Pharmaceutical and healthcare carton specialists, Chesapeake has formed an alliance with carton supplier Cartonajes Leca in a move that aims to extend its production network to southern Europe.

The partnership secured by the healthcare packaging firm forms part of an overall business strategy in which its presence in France, Germany, Belgium, Poland and Holland will now be backed up with a commercial agreement with Spanish-based Leca.

Under the terms of the agreement, Leca will become the representative of both companies in Spain and will become a local source of supply. Chesapeake said the alliance was established for purely commercial reasons only and did not involve ownership or exchange of shares or investment interest.

Leca, part of the Lantero Group, produces a selection of folding cartons for the pharmaceutical and healthcare market. It currently has three production sites, two operations in Madrid and a plant in Barcelona.

Packaging supplier

Leca is a well-respected packaging supplier and an ideal partner to further extend our presence in Southern Europe​,” said Mike Cheetham, pharmaceutical and healthcare director. “This trading alliance will enhance our service to customers allowing both parties to offer a greater range of products and to jointly develop new solutions​.”

Ramon Lantero, Leca’s Chief Executive Officer, said, “This alliance will strengthen our service to customers and will provide mutual opportunities for further developments.”

News of Chesapeake’s latest partnership echoes movements made by fellow pharmaceutical and healthcare packaging specialists Clondalkin Group.

Its Specialist Packaging Division now has eight European manufacturing sites in total boosted by its raft of acquisitions during the past three years. As well as the purchase of Cartonplex in Spain, January 2010 saw Lehigh Press, a Puerto-Rican pharmaceutical inserts and labels manufacturer come on board.

Chesapeake has adopted an approach in which investment is central to developing and further extending its integrated supply network.

Its acquisition of Polish label and carton manufacturer Cezar signified Chesapeake’s return to form after it was acquired by Irving Place Capital Management and Oaktree Capital Management in May 2009.

Chapter 11 bankruptcy

The US-based private equity houses stumped up $485m for the carton and plastic packaging group, four months after Chesapeake's fall into chapter 11 bankruptcy protection in December 2008.

Later on the firm invested in a GUK folding machine and a KBA press at its Greenford site to up production numbers for its pharmaceutical leaflets.

It also formed an international alliance in May by forming a partnership with Papcart, a Nantes-based supplier of premium cartons.

Chesapeake already has a significant presence in France operating four production plants of which three specialise in packaging for the pharmaceutical and healthcare sectors.

Related topics: Markets & Regulations, Drug Delivery

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