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Zeta's buy of Tucker bodes well for both.

LITTLE FALLS, N.J.--Zeta Consumer Products, manufacturer of Renew and other brands of trash bags, reached an agreement last week to acquire plastic housewares vendor Tucker Housewares from Mobil Chemical Co. The purchase price was not disclosed.

Tucker Housewares, the third largest supplier of plastic storage and a major supplier of outdoor refuse cans, has annual sales of just under $150 million, according to industry sources. Raj Bal, president of privately held Zeta, declined to give sales figures for Zeta but said combined sales of the two companies will be more than $200 million.

Zeta is affiliated with Sigma Group, a vendor of merchandise bags and other plastic bags. Sigma's sales volume is $350 million, Bal said.

Zeta plans to merge Tucker's marketing and sales forces with its own and pursue "aggressive growth plans" for its new business, Bal said. Details on titles and positions for Tucker's existing management team have not been worked out yet, he added.

The waste bag supplier plans to capitalize on the retail strongholds of each company to gain more of a presence in selected channels, Bal said. For instance, while both have placement in the mass merchant channel, Zeta hopes its strength in supermarkets will help Tucker gain a presence there, while Zeta's products may benefit from Tucker's hardware accounts, he said.

The vendor has identified synergies between Tucker's and Zeta's product lines--such as Tucker's trash cans and Zeta's trash bags--that offer "great opportunities" for cross-marketing, Bal said.

"Zeta has embraced our growth strategy," said Tom Cordano, Tucker's president. Cordano explained that the plastic storage company has been focusing on two goals, including creating value-added products with unique features that set the company apart from competitors.

The vendor also has reduced its expenses to support its opening-price product line. Zeta will continue to invest in product development and expects the combined purchasing power and increased volume will bring additional savings to the two companies, Bal said.

In addition to these objectives, Zeta plans to develop a line of recycled, injection-molded plastic products "Zeta plans to leverage the success of its 100 percent recycled Renew brand into the injection molded housewares markets," Bal noted. Zeta currently sells recycled trash bags made of 60 percent post-consumer materials under the Renew name.

Zeta will continue to use the Tucker name on all other injection molded products, Bal noted.

Having a supplier that sells both trash bags and plastic housewares will benefit retailers looking to consolidate their vendor lists, Bal said. It also presents distribution and freight cost advantages with the eventual combined use of five manufacturing and distribution centers, he added. Tucker has facilities in Massachusetts, Arizona and Texas. Zeta has plants in Illinois and New Jersey.

As part of an entrepreneurial company, Tucker is in a position to be more responsive to retailer's needs, Bal commented.

Several retailers, responded with cautious optimism to the news of the sale.

"My first question was how it would affect product introductions and product rollout," commented one mass merchant buyer, who said she has been assured that Zeta is committed to investing in product development. "New products have been their strength this year," she said.

The acquisition may overcome the reluctance of retailers to buy from a vendor whose future was uncertain, said George Schwartz, vice president and general merchandise manager at Pergament home centers. He said there had been widespread speculation after Mobil sold its Hefty bag business last fall that Tucker would follow.

"We loved their new hinged totes and their CedarTops line; they were right up there in terms of innovation," Schwartz said. "But it was hard to believe that Mobil was going to put a lot of money into new molds."
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Title Annotation:Zeta Consumer Products, Tucker Housewares
Author:Hill, Dawn
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Date:Mar 4, 1996
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