Largest pooler of plastic pallets loses 1. 5 million units, files for bankruptcy
What happens when the world’s largest pooler of plastic
pallets can’t find 15 percent of its stuff? Nothing good.
Intelligent Global Pooling Systems (iGPS) filed for bankruptcy protection in June after lenders reportedly declared
the company in default of its loan covenants because it
couldn’t account for 1. 5 million of its 10 million pallets.
Once lenders were apprised of the situation, they began
demanding immediate payments from iGPS, according to
legal website Thomson Reuters News & Insight, which cited
documents filed in federal bankruptcy court in Delaware.
According to the court documents, iGPS declared bankruptcy in part because of the loss of the pallets and in part
because it received a large number of damaged pallets from
its manufacturer, Schoeller Arca Systems Inc. (SAS).
Orlando, Fla.-based iGPS agreed to sell its assets to a joint
venture known as iGPS Logistics LLC. The venture includes
the private equity firm Balmoral Funds; One Equity
Partners, the private investment arm of JPMorgan Chase &
Co.; and Jeff and Robert Liebesman of the returnable packaging company Palogix International. (One Equity is a
shareholder in SAS.) The sale is subject to higher and better
bids, and court approval.
“After careful analysis, we determined that this sale of the
company to iGPS Logistics is the most advan¬tageous
option for iGPS’s customers, employees, suppliers, and
other stakeholders,” Dick DiStasio, CEO of iGPS, said in a
statement. The company said it plans to continue operating
without interruption during the sale period.
A PROMISING START …
iGPS was launched in 2006 with Bob Moore, former head
of pallet pooling giant CHEP, as its CEO. It billed itself as a
provider of pallets that were 30 percent lighter than wood
and could be tracked using RFID technology.
iGPS immediately began vying with CHEP for business,
particularly in the grocery and beverage segments. It landed such big names as ConAgra Foods Inc., PepsiCo, Kraft
Foods, SC Johnson, WalMart Stores Inc., and Costco Corp.
In 2011 and 2012, however, chinks began to appear in the
company’s armor. For example, ConAgra and Pepsi went
back to using CHEP as their pallet pool provider. It is
unclear if the defections were due to any business impact
surrounding the missing pallets. ;
—Susan Lacefield
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