MM Group to sell 70% packaging stake to KPS in US$2.8B deal

AUSTRIA – Mayr-Melnhof Karton has entered into a binding transaction agreement to offload a 70% majority stake in its packaging division to a newly formed entity managed by KPS Capital Partners, in a deal pegging the business at an enterprise value of €2.4 billion (US$2.82 billion).

Under the agreed framework, KPS will take a 70% majority stake in the holding entity, while MM Group will hold the remaining 30% to retain exposure to future value creation. 

The perimeter of the sale encompasses the food and premium packaging division, excluding facilities situated in Iran and Tunisia, as well as the pharmaceutical and healthcare packaging arm. 

Employing roughly 8,500 personnel across more than 50 manufacturing sites in 19 nations, the Vienna-headquartered business manufactures consumer packaging products including folding cartons, labels and leaflets for the food and beverage, pharmaceutical and healthcare, beauty and personal care, and household care sectors.

Separation Decouples Packaging From Board and Paper

The separation decouples the packaging branch from MM Group’s board and paper unit. Following completion, MM Group will concentrate its primary activities on the board and paper division while maintaining a minority position alongside KPS. 

The division will retain the MM Packaging trade name and will eventually be accounted for using the equity method. 

Proceeds are projected to leave MM Group with net cash of roughly €800 million (US$939 million) to €900 million (US$1.06 billion), with capital allocated to debt repayment, strategic initiatives and shareholder returns, including an intended special distribution of €500 million (US$587 million) to €600 million (US$704 million).

Leadership Frames Deal as Growth Catalyst

Michael Psaros, co-founder and co-managing partner of KPS, said the firm would leverage its deep industry experience, financial resources, commitment to manufacturing excellence and global presence to drive MM Packaging’s growth. 

Peter Oswald, chief executive officer of MM Group, said the transaction would allow the business to continue its growth under the leadership of KPS, a leading private equity investor in manufacturing and industrial companies. 

Completion Expected in First Half of 2027

Completion is expected in the first half of 2027, pending standard corporate approvals, regulatory clearances and works council consultations covering the French business. 

The transaction reflects broader private equity interest in European packaging assets, where investors have targeted manufacturing businesses with established customer relationships and opportunities for operational improvement, particularly in cartonboard converting and premium food packaging segments.

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