PGS Completes Its Coverage of France as a Launch-Pad for International Pallet Business Expansion

With two new takeovers in March, the leading producer and reconditioner of wooden pallets has made a total of ten acquisitions in France since 2009. PGS is now turning its attention to a new goal: international development.

With its latest acquisition, PGS (Palettes Gestion Services) announced that it has no further ambitions for significant external growth in France! The Group has now achieved efficient operational coverage of the entire French mainland, enabling it to guarantee its customers a flexible and competitive service. On 29 March 2013, the leading producer and reconditioner of wooden pallets confirmed that it had acquired 100% of the capital of F. ARNAUD and PALSUD, which both previously belonged to the ARNAUD Group. By acquiring these two pallet production plants, PGS has completed its coverage of France, with 10 acquisitions since 2009. The family-owned ARNAUD Group, meanwhile, which was created in 1951, intends to focus on its business of leasing metal crates and containers for the packaging and transportation of rubber. However the Manager, Benoît ARNAUD, will work alongside PGS as Managing Director of the F. ARNAUD production site, while also overseeing the international development of his own Group. The latter site, at Préchac, Gironde, in the Aquitaine region, is only 51 kms from the BEYNEL sawmill and production site, the traditional headquarters of PGS. Jean-Louis Louvel, Founder and CEO of PGS, explains: “Since 2009, we have acquired substantial know-how and considerably increased our range of products and services. For the first time, this acquisition was performed directly by a subsidiary, SAS BEYNEL, so that both entities could rapidly benefit from the obvious synergy that will result from integration of the two sites.” The second acquisition by PGS concerned PALSUD, located near the Etang de Berre (Bouches-du-Rhône), close to Marseille, a major shipping port.

20 years: a good age for setting one’s sights abroad

In 2013, PGS Group will be celebrating 20 years of activity and expects to achieve a consolidated turnover in the region of 200 million Euros, with an internal workforce of almost 1000. “In 4 years we have doubled our turnover,” declares Jean-Louis Louvel, “and we have every intention of doubling it again in the next four years.” The Group has clearly stated its determination to expand abroad.

These ambitious developments will also make its flow-management and pallet-return services more efficient in all the countries where PGS will be developing its activities: the Group’s senior management is convinced that “This is the future of our sector”. Concerning international development, especially in medium and major export activities, Michael Modugno, Founding Vice-President of PGS Group with responsibility for International Development, stresses that “the fact that some of our production sites are close to ports is no coincidence but the result of a genuine strategy to export our know-how and assist our customers with any logistical issues they may have in getting established abroad.” BEYNEL, acquired in 2009, is close to the port of Bordeaux and benefits from excellent road transport links to the port of Barcelona. Perurena, taken over in 2010, is close to the port of Le Havre. And the Belgian company De Backer, in which PGS recently invested, is close to the ports of Antwerp and Rotterdam.

Assisting customers

Michael Modugno also explains: “This helps all our customers, most of whom are French, who can now group all their pallet purchases at European level. We offer substantial cost-savings through mass purchases and, above all, by enabling more rational management and improvement of their products and references, not to mention optimisation of their pallet flows. As an example, there is a PGS team for international inspections capable of auditing all of a customer’s sites across Europe in less than a month! This would be a long and difficult task for a company seeking to have an overall view of the needs and specific issues of all its sites.”

Supporting French sawmills

Furthermore, the PGS Group will henceforth need more than 600,000 m3 of lumber for making new pallets, more than half of it supplied directly by the Group’s own sawmills. According to Jean-Louis Louvel: “Faced with the sad fact that a French sawmill disappears every three days, and to make sure that we can count on the volumes of lumber necessary for our production, which will be increasing, we have set aside a considerable sum of several million Euros, for investing in French sawmills.” PGS plans to support the primary transformation sector by taking a minority participation in sawmills, providing capital to ease cash-flow problems or helping them with necessary investments.

PGS Group (Palettes Gestion Services) was created in 1993 and is now a leader in the French market for wooden and moulded pallets, new and reconditioned, and for the production of lumber for pallets. With a full service offer and Europe-wide network, it is a key logistics operator in the packaging sector. In 2012, PGS returned consolidated sales of €141.7M for a workforce of 800. PGS has 6 sawmills, 11 pallet production sites and 28 reconditioning facilities, providing an annual production of 280,000 m3 of lumber, 18.6 million new pallets and 14 million reconditioned pallets. For further information, visit www.groupepgs.com.

 

 

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