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Veratec 100 Elm Street Walpole, MA 02081 (800)338-7952; Fax (508)668-4959 Worldwide Nonwovens Sales: $325 million U.S. Nonwovens Sales: $225 million Key Personnel: John Balboni, president; Richard Lacana, vice president-North America; Pat Racz, general business manager-consumer disposables; John DiLuzio, director of marketing-nonwoven fabrics; David Sayers, health and personal care; Chuck Kantor, specialty markets; Bart Morse, general manager-Natural Fibers Group; Jim Vogt, Industrial/Advanced Fiber Group; Dr. Nicholas Newman, market development; Zoltan Mate, director of engineering; Jim Anderson, president, Canada; Ian Butler, director of marketing, Canada; Bill Duncan, vice president and general manager, Europe; Robert Starski, marketing manager, Europe; Richard Gockleman, vice president, Far East Plants: Lewisburg, PA; Green Bay, WI; Athens, GA: Bethune, SC; Toronto, Canada; Griswoldville, MA (cotton bleaching); Liege, Belgium (Veratec Europe); Braunton, U.K. (cotton bleaching); Okahama, Japan Processes: Chemical Bonded, Thermal Bonded, Hydroentangled, Wet Laid, Spunbonded, Ultrasonic Bonded Trade Names: Webril, Webline, Flexilon, Novonette, Confil, Stripfil, Dryfil, Convene, Safe 'N Shielded, Veratuf, Easy Street (super opened cotton fiber) Major Markets: Absorbent Products, Fabric Softeners and Laundry Additives, Medical, Personal Care, Wipes, Home Furnishings, Industrial, Roofing, Filtration, Battery Separators, Electrical and Acoustical Insulation Notes: Veratec, on the strength of a new spunbonded line just started up in Canada, has solidified its position as a leader in the worldwide nonwovens industry with a continued emphasis on its single major market of consumer disposables as well as increased effort into a host of nonwoven end use categories.

At the same time, the fourth largest producer of nonwovens in the world--with more than $325 in roll goods sales last year and projected growth to $350 million in 1991--is in the midst of a long term assessment program designed to lay the groundwork for its nonwovens activities through the remainder of the century. This process is being headed by Veratec president John Balboni; because of this process vice president Richard Lacana has been handling the bulk of operational duties for much of 1991.

Attempting to quiet some industry rumors of changes imminent at Veratec, Mr. Balboni told nonwovens industry that no organizational change has been put in place for its nonwovens business. "I am spending a lot more time working on some strategic planning efforts for the long term and in so doing [Mr. Lacana] has taken up some of the day-to-day responsibilities," he said, adding that "it's not a big deal." The intention is to allow Mr. Balboni to spend more time working on strategic initiatives that had been disregarded to some extent while the assimilation of the International Paper and Kendall businesses took place during the late 1980s. This process should end within the next few months and the strategic direction for the 1990s should be firmly in place.

Whatever the direction in which Veratec ultimately turns, nonwovens will remain its primary business. That is more than apparent in the $10-13 million investment the company recently made in installing a spunbonded line in Toronto, Canada, the first such production line in that country. The 3.2 meter line, up and running at the start of the year, has an estimated annual capacity of 8-12 million pounds of primarily light and medium weight fabrics. The line is based on licensed Reifenhauser technology.

Veratec selected Canada as the site for the new line primarily because of the domestic demand for medium weight nonwovens, which are the subject of a very high tariff barrier. In addition, the company had the facilities in place in the form of a former Kendall facility, as well as management and technical expertise. "We want to keep the focus on the medium weight nonwovens, but we will also be in the lightweight area," Mr. Lacana said, pointing out that the Free Trade Agreement between the U.S. and Canada has made doing business there even easier. The Canadian market remains the primary outlet for the goods, followed naturally by the U.S., with some product being shipped to the Far East. Mr. Lacana also said that the Canadian location would definitely be considered for any further North American expansion.

In Europe, Veratec continues to operate a highly successful unit whose capacity at a single plant in Liege, Belgium has been sold-out for some time. Expansion in that market is a distinct possibility, but more so through acquisitions that new plants. "We continue to look for opportunities to expand through acquisitions or joint ventures in Europe," Mr. Balboni said. "It is illogical to put new capacity in place in Europe at a time when the industry is consolidating."

In the Far East, Veratec has been an industry pacesetter through its long time minority joint venture (begun by International Paper) in a company called Rengo International. Mr. Balboni said Veratec is also looking at expansion anywhere in Asia. "We are very active in Japan with expansion, but in the context of understanding the opportunities and markets and geographic demands," he said. Until the day comes when a significant move into the market is approved, Veratec will continue to develop markets with imported fabric from the U.S., Canada and Europe.

Nonwoven Consumer Disposable And Specialty Operations

The nonwovens business at Veratec remains divided into two units that are roughly equal in sales volume but vastly different in structure and markets. The Consumer Disposables Group, under Pat Racz, coordinates all sales to the disposable diaper business, primarily Procter & Gamble, as well as consumer products such as fabric softener sheets and laundry additives. The second is the specialty nonwovens area, headed by John DiLuzio, which, for the sake of simplicity, handles everything else.

Ms. Racz reported that the coverstock business has expanded significantly in the past year, primarily because more nonwoven is being used in each diaper. Veratec, which remains one of the leading North American suppliers to the baby and adult diaper and feminine care industries, recently added thermal bonded capacity at its Lewisburg, PA plant. The wide, high speed line is virtually dedicated to producting coverstock and is already sold out. "The demand in the industry instantaneously increased 30% because of the new diaper designs," Ms. Racz said in explaining the relatively rapid full utilization of the new line; another reason is the switch of many chemically bonded underpads to a thermally bonded product.

The Consumer Disposables unit instituted a subtle shift in focus this year when it began to view its core market as the entire Americas. One of the focuses, Ms. Racz said, has been Latin America, where an on-going marketing expansion could potentially lead to local production by the mid-1990s. Veratec is also selling its Canadian spunbonded product into the U.S. coverstock market. Veratec remains a primary supplier of nonwovens for Colgate's innovative "Fab One Shot" laundry additive product and for P&G's "Bounce" dryer sheet, among others.

Mr. DiLuzio's specialty nonwovens group has the task of covering the remainder of the myriad of nonwovens end uses. Among the major markets and his comments on them:

* Industrial: One of the unit's two largest applications, it covers apparel, filtration, battery separators, construction and roofing, electrical insulation and a commission finishing business (primarily for woven materials). The apparel ("strong, growing rapidly") and filtration ("we are revving it up here") areas are the two largest niches. It has been a good year for batteries and Veratec is expanding geographically into Europe.

* Health and Personal Care: Here Veratec is a supplier of wound care products to former parent company Kendall, to the large hospital sector and to the personal care sector. "The part that is really percolating is medicated products." There has been a move towards composite, two-sided products, where one side will be coarser than the other, and towards fabric and composites that will provide much sought after product differentiation.

* Wipes: There has been a shift towards more high tech, specialized wipes. "The mix shift is very apparent. We are much less involved with unsophisticated applications and more into products like automotive wipes."

* Home Furnishings: The segment remains a bit sluggish because it is so tied to the economy and changes in furniture designs, neither of which have been very active in the past year. "People are simply battening down the hatches and not buying much new furniture."

* Advanced Fiber Nonwovens: One of the pet projects at Veratec has been in Advanced Fibers, a unit that grew out of International Paper research and as a part of Veratec has come to focus on nonwoven technologies as the means to its end. The unit is charged with developing unique fabrics that take a high degree of sophistication utilizing specialty fibers. "It is not unusual to use fibers that cost $1000 a pound, so the cost of entry is very high and you can have an R&D investment that spans the better part of 10 years." Two new products that recently came out of this unit are a novel airplane de-icing nonwoven and its new "Safe 'N Shielded" fabric line.

The first is a system for de-icing the wings of aircrafts in winter, developed by Veratec and Thermion. The system uses an extremely lightweight conductive fiber mat that can be applied under the paint on wing surfaces where ice builds up. An electronic controller connected to the mat provides heating and system monitoring. The mat is made of nonwoven metallized carbon fibers and weighs just one-third oz. sq. yard. American Airlines plans to try out the system on a decommissioned plane and Thermion expects FAA approval after 12-18 more months of testing.

Secondly, an agreement for the production and marketing of a new electromagnetic shielding material for architectural applications was entered into by Monsanto's Advanced Performance Materials Group, St. Louis, MO, and Veratec under which Monsanto will apply its patented process for "Flectron" metallized materials to a variety of Veratec fabrics in its Saf |N Shielded product line. The Flectron materials are combinations of metals and substrates that provide the qualities of metal plus the unique performance characteristics of the substrates involved. Architectural shielding is becoming more important for offices, hospitals and homes, where efficient methods of protecting sensitive electronic equipment from electromagnetic interference are needed. The first material developed under the agreement will be "Saf |N'60," a plated nonwoven fabric that can provide at least 60 decibels of attenuation over a wide frequency range.

* Natural Fibers Group: Among the most successful business units within Veratec, the Natural Fibers Group, which produces and markets bleached cotton into the nonwovens industry, is still in the midst of an expansion at its main bleachery in Griswoldville, MA and is in the engineering stages of a new facility at Veratec's site in Bethune, SC, although no final word on that project is imminent. Bleached cotton from its Toronto plant is also making its way into the North American market; its U.K. facility in Braunton services the European side of the business.

Veratec is by far the primary supplier of bleached cotton to the nonwovens industry and it has led in market development and technology advances. Thus far it has been able to keep ahead of demand through capacity expansions, debottlenecking and process improvements at its existing plants. "We have been able to reasonably balance demand and capacity the past few years," reported general manager Bart Morse. "We haven't had to turn anyone away."

The unit is banking on its new "Easy Street" super-opened cotton as the next vehicle to drive its move into nonwovens. The new cotton product, bleached in Griswoldville and further processed in Bethune, became commercially available in the first quarter of 1991. The market for this new cotton technology, although extremely promising, remains largely undefined. "We are still seeing where Easy Street leads," said market manager Ed Hart. But with the commercial capabilities able to be brought on-stream so quickly in Bethune, marketing and technical development has begun in earnest.

The 1991-92 Marketing Plan

"We have a lot on our plates right now," explained Mr. Lacana. "We did a lot of work at the beginning of the company setting up strategic direction. Now the new products are starting to come out and the technology additions are taking shape."

Veratec's short term strategy is to continue its march into the specialty segments while maintaining its leadership role in the disposable coverstock area. As for its long range direction, stay tuned.
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Title Annotation:nonwoven fabrics business
Publication:Nonwovens Industry
Article Type:company profile
Date:Sep 1, 1991
Previous Article:The top companies in the worldwide nonwovens industry.
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