USA – Intertape Polymer Group (IPG) has entered into a definitive agreement to acquire substantially all of the operating assets of Nortech Packaging for cash consideration of approximately US$36.5 million.
As a privately-held company based in the greater Chicago, USA, Nortech Packaging manufactures, assembles and services automated packaging machines under the Nortech Packaging and Tishma Technologies brands.
Its custom-infeed and robotic solutions for packaging applications are designed for cartoning, case-packing, case-erecting, pouch-packaging and palletizing for the food, e-commerce, confections and beverage industries.
Intertape Polymer said that the acquisition will expand its product bundle into technologies that are increasingly critical to automation in packaging.
With an installed fleet of more than 400 machines, Intertape Polymer believes that the acquisition provides the company with opportunities to supply consumables to the existing fleet, as well as deploy system-selling for new customers combining machines with ongoing consumables.
Notably, the deal will add engineering automation and integrated robotic design talent to IPG’s existing engineering and design teams.
Upon closing, IPG expects these new capabilities will allow it to service customers experiencing growth pressures that require a customized automation solution.
“Packaging automation and system design are playing an increasingly important role in our customer’s competitive positioning, especially in the e-commerce market,” said Greg Yull, President and CEO of IPG.
“We believe this acquisition will provide us with the opportunity to move upstream in our target customer’s production process with an expanded product bundle and a continuous supply of consumables.”
“We have laid out a clear strategy to further strengthen our product bundle and continue to grow with our e-commerce customers as they expand around the globe. This acquisition delivers on both fronts.”
The acquisition is subject to customary closing conditions and approvals and is expected to close in the first quarter of 2020.
IPG expects to finance the acquisition with funds available under its $600 million credit facility.