Pro-Pac Packaging is acquiring Integrated Packaging Group (IPG), through a share sale agreement to the value of $177.5m.

Citing pro-forma FY18F revenue of $472m, EBITDA of $37.7m and net profit after tax of $18.4m, Pro-Pac says it is positioned to capitalise on the growing flexibles market, backed by favourable consumers trends around fresh food and food safety.

The company says IPG is one of Oceania’s largest specialist manufacturer and distributor of flexibles, film, wrap, and associated products with number one and number two positions in key end markets.

“IPG operates five world class manufacturing facilities across New Zealand and Australia and has a strong and proven track record of manufacturing high quality products for its diversified blue-chip customer base,” says Pro-Pac.

Grant Harrod, CEO, Pro-Pac – and former Salmat CEO –  says, “The combination of Pro-Pac and IPG provides exciting opportunities in the growing Australian flexibles packaging market. Pro-Pac’s expanded capacity to manufacture and distribute high quality products will delight our customer base and provide us with a one-stop-shop offering. Pro-Pac will be a world class manufacturer without geographical constraints as we increase our offerings in key areas such as food service and agriculture film.”

Ahmed Fahour, chairman, Pro-Pac, and says, “The acquisition of IPG represents a significant milestone in the realisation of Pro-Pac’s vision to become the preeminent flexible and industrial packaging manufacturer and distributor in Australia. The opportunity to combine two complementary businesses will deliver significant long-term value to Pro-Pac shareholders.”

Pro-Pac says it is poised to become the preeminent flexible and industrial packaging manufacturer and distributor in Australia post-merger.

It is to be funded through a combination of $60m Pro-Pac shares issued to vendors, a $54.8m fully underwritten equity raising, and $70m from a new debt facility.

Rupert Harrington is set to be appointed to the Pro-Pac board as a non-executive director, with Pro-Pac shareholders to approve the deal at an Extraordinary General Meeting scheduled for late October.

The merged entity will have customers including Coca-Cola Amatil, Unilever, Blackmores, Arnott’s, Coles, Aldi and BlueScope Steel.

Leave a comment

Your email address will not be published. Required fields are marked *