AUSTRALIA – Aseptic carton packaging manufacturer, SIG Combibloc has reached agreement to acquire Visy Cartons from VisyPak Operations, a subsidiary of Pratt Consolidated Holdings, for AU$70 million (US$48.29 million).
Pratt Consolidated Holdings is a privately-owned Australian company operating in the packaging, paper and recycling industries. Visy Cartons will become part of SIG’s business in the Asia Pacific region.
Over the past years, Visy Cartons has been producing SIG aseptic cartons under licence from SIG for sale in the Australia and New Zealand markets.
The company generated revenue of AU$84 million (US$57.95 million) in its fiscal year ending June 2019, of which SIG aseptic cartons formed approximately 80% of the sales, while the remainder was generated from fresh milk cartons.
Visy Cartons is one of the leading players in the Australian beverage carton market. With the acquisition, SIG seeks to expand the business to New Zealand, where Visy Cartons currently has a very limited presence.
The profitability of Visy is expected to increase with the realisation of significant synergies, arising from supply chain optimisation and access to SIG’s latest technologies and solutions.
The overall Australia and New Zealand market for aseptic beverage cartons is projected to grow at around 3% CAGR over the next five years, driven mainly by investments in dairies for the export of aseptic milk to China and other Asian countries.
The acquisition of Visy Cartons will enable SIG to further support its existing customers in Asia who have invested into or partnered with players in Australia and New Zealand.
Commenting on the deal, Lawrence Fok, President and General Manager of SIG Asia Pacific said: “We are very pleased to welcome the management and employees of Visy Cartons to SIG after many years of collaboration.
“Visy has an excellent team with a proven track record and together we will work to ensure that customers in Australia and New Zealand enjoy excellent service and access to our leading technologies.
“We plan to leverage our broad product portfolio to tap into the New Zealand market.”
Adam Lipscomb, who will remain General Manager of Visy Cartons, said: “We are delighted at becoming a member of the SIG family and are looking forward to pursuing growth opportunities from a strengthened position with expanded product and geographic opportunities.”
SIG said it will fund the acquisition through cash balances and existing credit facilities. The transaction is expected to close during the fourth quarter of 2019.