TPG Plastics CFO talks about products, company’s history


TPG Plastics CFO talks about products, company’s history

MURRAY — The company that is expected to begin operations in early 2020 at the spec building in the Murray West Industrial Park may not be very familiar to western Kentucky residents by name, but chances are, many have used its products. 

TPG Plastics features plastic gas containers, which will be manufactured at the Murray facility. 

“We’re incorporating flame-retardant material into the mouth of the can. Even if someone is misusing the can (such as, for whatever reason, using an open flame near the can) this precludes the flame from re-entering the can,” said Pavel Smyshlyaev, chief financial officer for TPG Plastics. “In addition, another thing we have launched is the ergonomic piston drip downspout, which requires only one hand to use and this is in response to all of our competitors making the consumer experience a lot more ergonomic.

“This is going to be available in your Dollar General stores, Lowe’s, Home Depot, Advanced Auto. You look at this thing and it’s obvious that it’s easy to use, very sturdy and much more durable than those of our other competitors.”

Smyshlyaev was present for the early-December unveiling of TPG Plastics being the new tenant of the spec building, which was constructed by the Murray-Calloway County Economic Development Corporation as a recruiting tool for manufacturing companies. It measures about 62,000 square feet, but Smyshlyaev said an expansion will be needed in the future. 

“I said this kind of in jest, but it really was not a joke. The next conversation I’ll probably need to have with (EDC President Mark Manning) is what it takes that hill (on the site) out of the way and make this into at least 120,000 square feet,” Smyshlyaev said, noting that the spec building site is expected to initially employee about 50 workers. 

Smyshlyaev said other facilities TPG operates have expanded to as many as 75 to 100 employees. 

“These are all going to be full-time jobs,” he said. “Initially, we’ll probably have about 20 operators, shift supervisors and quality control people. We’re also hoping to have an engineering department, especially as we grow into what is called a small off-road market.

“We know that by the time we get to that point, we would need to expand this specific building backwards to 200,000 square feet, or at least 120,000 square feet. You see, our products, they’re containers, so they require a lot of warehousing space. With this facility, as it is right now, we could fill this in about two months.

“It is a fascinating building, that’s for sure. It looks like something you’d see more in a place like Sweden or Norway. We certainly did not expect to find this in Murray.”

Smyshlyaev said that plans are to have the Murray plant operational by sometime near the end of the first quarter of 2020. He said one large piece of machinery that will be used for manufacturing the containers was expected to arrive in Murray sometime in January. He said hopes are to move another by February. 

This is also a company that is in the midst of a comeback. It originally was known as Plastics Group Inc., which operated from 1998 until May 2018. Smyshlyaev said it used to operate two blow-molding facilities, with one in Ohio and the other near Chicago. Smyshlyaev is also the principal of the Beaconhouse Capital management group that took over the Plastics Group Inc. in May 2018, after he and his business partner, Saquib Toor, began looking into assuming control of the company in 2017 by beginning communications with the company’s lender. 

“The facilities were still operating at that point, but the company had no management. The company was being run by a chief restructuring officer and it was running out of cash very rapidly. So what we saw was an opportunity to rebuild the company with capitalization,” he said, noting that, by early 2018, the Ohio plant was clearly unable to continue operating. The lender then foreclosed the assets, enabling Beaconhouse to purchase the company in what is known as an Article 9 foreclosure sale. 

“There was no management, so it became clear to (himself and Toor) that we needed to relocate to Chicago to rehabilitate the company. It was losing about $200,000 a month. Well, we have effectually facilitated a turnaround at this point and, right now, we’re in a growth phase. We saw a tremendous opportunity in this fuel containment market and Saquib and I have made previous investments in plastics so we do have expertise in plastics materials. By early 2019, we had started focusing on expansion and making this is a much bigger business than what we bought and rebuilding it back to what it was.” 

Now, it has brought that expansion to Murray. 

“For us, it was important to see a town where we could see ourselves relocating, and only then did we approach people like (plant manager Rachel Overhardt) to see what their reaction would be,” he said, explaining that he began looking at Murray shortly after hearing in mid-August that Briggs & Stratton would be closing its Murray facility in 2020. “Everybody went down here over the course of the next month and the commonplace response was ‘When?’ So it was not, ‘Why?’ or ‘What do I get for doing this?’ or ‘Oh man! I’ve got to pull my kids out of their school!’ For instance, Rachel was ready to go.

“That was basically at the heart of our decision.”

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