Apollo to buy 67% stake in Italian packaging firm Reno De Medici for US$430m

ITALY –  Apollo Global Management, a US-based investment fund, has agreed to acquire a 67% ownership stake in Reno De Medici (RDM) from its two principal shareholders, Cascades and Caisse de dépot et placement du Québec.  

Apollo which made the acquisition for about US$430 million plans to launch a mandatory tender offer for the remaining shares, with the aim of delisting RDM. 

RDM produces and distributes cardboard made from recycled fibers, which is mainly used for packaging and folding cartons in all product sectors including food. 

The company recently purchased mills in Spain and entered into an agreement to buy mills in the Netherlands.  

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Upon closing, the two deals will see RDM’s operations grow to nine mills and five specialized cutting and sheeting centers across Europe and the US. 

According to Apollo, RDM will continue to benefit from increasing shifts in consumer preferences and EU-wide regulations supporting the use of sustainable, recycled fibers. 

“Already one of Europe’s top leaders in recycled carton board, RDM is well positioned for continued growth as more companies replace plastics with sustainable packaging,” said Marc Becker, senior partner and co-lead of Apollo Impact. 

Michele Bianchi, CEO of RDM, added: “We are excited to work with Apollo through this next phase of growth for RDM. Over the last five years, our exceptional team has made significant progress in scaling our platform and optimising our operations across Europe.” 

Cascades will reportedly receive €315.3 million (about US$371.59 million) for its 57.6% stake in the Italian producer of cardboards.

This will see the Canadian company exit the European market, providing it with room to strengthen the position of its core North American packaging and tissue papers business operations. 

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“Today’s announcement signals the end of our company’s successful 35-year operating history in Europe,” Mario Plourde, president and CEO of Cascades, said. 

 “While Cascades is turning a page to focus on North America, we are confident that the team at Apollo will be an ideal strategic partner to support RDM’s future growth.” 

Earlier this month, Apollo Global entered the race to buy UK’s fourth-largest retail Chain Morrisons.  

In a statement, Apollo has said that it is in the preliminary stages of evaluating a possible offer for Morrisons on behalf of investment firms managed by Apollo but is yet to table a formal bid.  

However, it added: “No approach has been made to the board of Morrisons. There can be no certainty that any offer will be made, nor as to the terms on which any such offer might be made.” 

The entry of Apollo has made analysts to speculate that other private equity groups and e-commerce giant Amazon, which has a partnership with Morrisons, could also join the fray.   

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