USA – Aspectic packaging manufacturer SIG Combibloc is set to expand its sustainable packaging capabilities with the acquisition of packaging solutions company, Scholle IPN, for an enterprise value of €1.36 billion (US$1.53bn).

US-headquartered company Scholle IPN produces and distributes packaging systems and solutions for liquids, such as bag-in-box packaging and spouted pouches.

 The business owned by Dutch businessman Laurens Last currently has an estimated 2,100 employees globally.

Incorporation into its much larger peer will expand Scholle IPN’s portfolio into the Asia Pacific, Latin America, Middle East, and Africa markets – where SIG has a well-established presence.

SIG will also benefit from the acquisition as it will get to build on its capabilities in aseptic technology and expand its use in both pouches and bag-in-box. 

The partnership will also strengthen the research and development capabilities of the two companies.

A leader in aseptic food packaging, SIG said the deal would help it increase its presence in the United States, where Scholle generates 55% of its sales.

Chief Executive Samuel Sigrist told journalists that he expects group revenue to keep growing by 4-6% per year over the medium term, while profitability – under pressure from increasing input costs – is expected to dip temporarily before recovering to over 27%.

The combined company will employ almost 8,000 people in 69 sales and manufacturing sites across the globe.

The acquisition of Scholle IPN cements SIG’s position as a global leader in innovative and sustainable packaging for food and beverages,” Sigrist said. 

It is consistent with our strategy of geographic and category expansion accompanied by share gains in key markets. By delivering clear benefits for customers, consumers, and the environment, we will drive value for shareholders.”

The enterprise value is equivalent to a multiple of 14.5 times adjusted earnings before interest, tax, depreciation, and amortization (EBITDA).

SIG said it will be funded through 33.75 million SIG shares from existing authorized capital and 370 million euros in cash and debt refinancing.

The Swiss packaging company will also issue equity of around 200 million-250 million euros to cover the transaction.

Scholle’s current owner Laurens Last will become SIG’s biggest shareholder with a 9.1% stake, subject to a lock-up period. He will also join SIG’s board.

The transaction is expected to close in the third quarter of this year, subject to customary closing conditions.

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