ASIA – Aseptic packaging supplier SIG has agreed to acquire Pactiv Evergreen‘s Asia Pacific fresh operations for an enterprise value of US$335 million.
The business supplies filling machines, cartons, closures, and after-sales service to its customers in the fresh segment mainly within the milk category.
Also known as Evergreen Asia, the recently acquired business has production facilities in mainland China, South Korea and Taiwan and is starting to develop in other Southeast Asian markets.
The acquisition will enable SIG to strengthen its position with existing customers and to expand into a new customer base.
SIG also plans to use its local R&D presence and innovation capabilities, as well as its marketing expertise, to produce more innovative packaging formats in the fresh dairy market.
Lidong Fan, president and general manager in Asia Pacific North, said: “In China, milk is increasingly seen as an important source of protein and as good for health, representing an attractive growth opportunity for fresh as well as aseptic milk.
The Evergreen Asia business adds fresh milk cartons to our strong liquid dairy portfolio which, until now, has been mainly focused on single-serve packs and on-the-go consumption.”
Expansion into fresh milk will be highly strategic for SIG as the Asia-Pacific Dairy Market is projected to grow at a CAGR of 3.12% during the forecast period 2020-2025, according to Mordor Intelligence.
The market research firm notes that China is the most significant market for dairy primarily driven by increased consumption of dairy products.
With Evergreen Asia having a significant presence in China as well as other high-growth markets in the region, its addition to SIG is certainly expected to have a positive impact on the company’s bottom line.
Appreciating this reality, Fan said, “As fresh milk is mainly consumed at home, this acquisition broadens our range with an increase in family-sized packs.”
As part of the transaction, SIG will be entering into a new coated carton board purchase agreement with Pactiv Evergreen.
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