SOUTH AFRICA – AR Packaging group has entered into a definitive agreement with South Africa’s Nampak for the acquisition of its Nigerian packaging business, Nampak Cartons Nigeria at an undisclosed amount.
Nampak Cartons Nigeria, Subsidiary of the Johannesburg stock exchange listed firm, Napmak, engages in production of packaging material production for the food and consumer goods segments.
André de Ruyter, Nampak’s chief executive, said the disposal of the packaging business in Nigeria was part of the group’s ongoing strategy to sharpen its focus on strategic underlying businesses, reports Business Report.
“We continue to rationalise the portfolio to improve returns on capital and reinforce our strategic intent. Proceeds from this disposal will further strengthen the company’s financial position,” De Ruyter said.
Nampak, which is the leading packaging group in Africa with presence in eleven African countries, said the disposal was subject to customary closing conditions, including local regulatory approvals.
“The parties to the transaction have agreed that no financial details will be disclosed,” the group said.
Harald Schulz, president and chief executive officer of Sweden based AR Packaging, the acquisition is critical in the company’s expansion plan especially across Africa.
“With the acquisition of Nampak Cartons Nigeria, we have taken an important first step towards establishing a footprint in the African market.
We are very pleased to have found such a competent partner for our global growth ambitions, and we will now be able to serve our multinational customer base on three continents
Together with the highly experienced management team of Nampak Cartons Nigeria, we are convinced that we will be able to deploy true growth opportunities in Nigeria and more broadly in Africa,” Harald said.
AR Packaging Group, In December 2018, also acquired Croatia-based folding carton products maker Istragrafika for an undisclosed value.
Established in 2004, Nampak Cartons Nigeria has a production facility in Ibadan, Oyo State, Nigeria, employing 200 people.
Nampak, in the update, revealed that the macroeconomic environment in South African gross domestic product slowed down to 0.8percent in 2018, even though the last two quarters in 2018 had positive growth.
In February this year, Nampak unveiled that it has decided to dispose of its glass business and had been in exclusive negotiations with a preferred bidder in respect of the potential disposal.
The company aimed to conclude a purchase agreement and sale by this month.