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Box-Maker Who Wowed Trump With Garbage Has $6.6 Billion Fortune

Box-Maker Who Wowed Trump With Garbage Has $6.6 Billion Fortune

(Bloomberg) -- Donald Trump expressed his astonishment.

“It’s really amazing,” the American president said during a September tour of an Ohio paper-recycling mill, accompanied by its billionaire owner, Anthony Pratt. “They start off with waste, garbage, and they end up building it into a -- making it into really great cardboard and paper.”

Trump’s tour of the new facility in Wapakoneta was a coup for the Australian mogul behind Pratt Industries USA Inc., with annual revenue of more than $3 billion.

Box-Maker Who Wowed Trump With Garbage Has $6.6 Billion Fortune

It’s also indicative of how far he’s come since moving to the U.S. in the early 1990s in search of his own legacy, after his father Richard built one of Australia’s biggest fortunes with another recycling business called Visy.

“We were a schlock recycler,” Pratt, 59, said in a phone interview last month.

The Conyers, Georgia-based company struggled for about 15 years until public perception of recycling began to shift, he said. He was helped by Walmart Inc.’s 2006 commitment to reduce packaging by 5% across its supply chain.

“All of a sudden the big corporates wanted to recycle paper and we were the only ones who were 100% recycled,” he said.

Pratt, who’s chairman of both Pratt Industries and Visy, said he’s responsible for five of the last six paper mills to begin operating in the U.S., where the group has about 70 factories.

“We made a pledge to invest $2 billion in America to create 5,000 high-paying manufacturing jobs, mainly in the Midwest,” he said. “That was music to President Trump’s ears.”

Trump, who also was accompanied by Australian Prime Minister Scott Morrison, praised the investment.

“That’s great news for America, and we also spend a lot in Australia,” he said. “I think we’re your largest investor, by far.”

While Trump has said he supports a clean environment, his administration has reversed regulations designed to promote clean air and water and he’s withdrawing the U.S. from the Paris climate accord.

The White House declined to comment.

Family’s Fortune

Pratt’s success in the U.S. has helped lift his personal wealth to $6.6 billion, making him Australia’s sixth-richest person, according to the Bloomberg Billionaires Index, a ranking of the world’s 500 wealthiest people. The family’s combined fortune, which includes his sisters’ Visy stakes, is about $11 billion. Pratt’s Visy holding is worth about $2 billion.

Access to 30-year green bonds aided growth without the need for external investment, Pratt said. Rapid industry consolidation, access to cheap waste and the cutting of freight costs by building factories near mills also helped.

Pratt has benefited from investment in technologically sophisticated mills, low-cost recycled paper and vertical integration, said Joshua Zaret, a Bloomberg Intelligence analyst specializing in packaging, paper and forest products.

“He’s taken a different approach and it’s been very successful,” Zaret said.

Pratt splits his time between Melbourne and New York, where his Staten Island paper mill churns out more than 1 million pizza boxes a week. Each day, three barges transport about 1,500 tons of waste paper down the Hudson River to the mill that has been operating since 1997.

Converting Waste

At the company’s five clean-energy plants -- four in Australia and one in the U.S. -- waste is converted into electricity to help power the paper mills in what Pratt describes as a closed-loop system.

Pratt’s market share in the U.S. is about 6.5%. In Australia, Visy has 55% of the market and annual revenue of about $3.4 billion.

Pratt said he wants more in the U.S. but won’t be rushed. He plans to have 12 paper mills in operation during his lifetime and sees two more generations of growth for the family business.

Sales will be aided by a broader understanding of the roll of recycling in combating climate change, he said.

“Recycled paper has become cool.”

--With assistance from Josh Wingrove and Jack Witzig.

To contact the reporter on this story: Andrew Heathcote in Melbourne at aheathcote4@bloomberg.net

To contact the editors responsible for this story: Pierre Paulden at ppaulden@bloomberg.net, Peter Eichenbaum, Steven Crabill

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