IPP claims to offer a better solution than scrapping for both buyer and seller when it comes to second-hand process equipment . Andrew Warmington spoke with the firm ’ s leaders
PROCESS EQUIPMENT
Equipped for the future
IPP claims to offer a better solution than scrapping for both buyer and seller when it comes to second-hand process equipment . Andrew Warmington spoke with the firm ’ s leaders
Some in the chemical industry probably regard purveyors of second-hand process equipment as glorified used car salesmen . And , to be fair , Ron Gale , president of New Jersey-based International Process Plants ( IPP ) does rather look the part . However , a look at what the company actually does gives a very different picture
Gale and his brother Jan founded IPP in 1978 , when there were plenty of companies selling used machine tools but very few selling used process equipment . They began by buying and selling individual pieces of equipment . Later they moved into complete processes , then complete plants and real estate . In the 1980s , it branched into Europe . Whilst plenty of companies do some of these things , the Gales believe that IPP ’ s ' whole solution ' model is unique .
Buyers & sellers
“ A lot of equipment and sites were being scrapped and demolished when they were no longer in use ,” says Ron Gale . “ We were able to give a better value proposition to the owner by buying it , and to our customers by making it quickly available at 50 % of the price of new .” Despite all the changes in the world since then , the basic value proposition remains essentially the same today .
Where a company is selling a site as a going concern , of course , it will usually find a buyer directly . IPP works in the area of idled facilities , where sellers can be spared the need to evaluate an unwanted facility , work out the cost of dismantling it and selling equipment piecemeal to multiple buyers , and
Ron ( left ), Ross ( centre ) and Jan ( right ) Gale still run IPP as a family concern
dealing with regulatory issues , demolition and environmental projects .
“ If a company handles its own disposal , it will typically transfer some equipment internally , sell some off , demolish a building , pull up the foundations and carry out environmental remediation ,” says Jan Gale , executive vice president of the company . “ This can be a three-to-five year operation and the carry costs alone of hundreds of thousands per month plus the cost of demolition and environmental remediation most often will be more than they can get for the site versus selling to IPP .”
Prospective buyers , meanwhile , get more time to study the proposition with IPP than it would if dealing with the seller directly . IPP can sub-divide a plant for them , organise a lease , offer finance and give the buyer more options than the original owner would have been able to or want to .
Both men are firm in stating that IPP is not a broker . “ We are investing
our capital in a strategic way ” says Ross Gale , Jan ’ s son , who is director of acquisitions . “ We are finding opportunities for sites in industries where we think it makes good business sense to either repopulate , relocate or redevelop .”
IPP has developed a 160,000-strong customer base over its 46 years . At present , it has 14 global offices and owns 17 complete plants , mostly in the US and Europe . Among the latest acquisitions are a former Novartis API site in Grimsby , UK , covering about 55 hectares and , most recently in April , a smaller detergent manufacturing plant in Lomazzo Italy , from Henkel .
The company owns or controls 110 complete processes within plants where that process is idled but the rest of the plant continues to operate . In addition , it owns 15,000 equipment systems and major pieces of equipment stored on three sites , one in the US , one in the UK and one in Germany , covering a combined 130 hectares
MAY / JUN 2024 SPECCHEMONLINE . COM
71