Packaging firm Essel Propack has acquired remaining 75.1% stake in its German joint venture Essel Deutschland (EDG) for $32m.
As part of the agreement, Essel’s Mauritius subsidiary Lamitube Technologies (LTL) will increase its stake from current 24.9% to 100% in Essel Deutschland.
With the deal, EDG will become a wholly-owned subsidiary of Essel Propack.
The transaction is part of Essel’s effort to unlock synergies such as enhanced cross selling opportunity in the German markets and sourcing flexibility.
Essel Propack managing director and vice-chairman Ashok Goel was reported by Press Trust of India as saying: "The acquisition of EDG will further enhance our position in the non-oral care category.
“This move is in keeping with our overall plans for achieving revenue growth of 15% and PAT growth of 20% and achieving our Mission 20:20:20."
Within next two years, the company’s 20:20:20 mission aims at achieving earnings before interest, taxes, depreciation, and amortization (EBITDA) margin of 20%, return on equity (ROE) at 20% and return on capital employed (ROCE) at 20%.
The company said: “The EDG revenue of approximately $40m will now be consolidated in Essel’s global revenue and will boost consolidated revenue by 11%.”
Essel expects the deal to help improve its market share in Europe while creating a strong growth platform for the non-oral care category.
Additionally, the acquisition will allow Essel to offer high decoration laminated tubes to the premium non-oral care brands across Europe, reported VCCircle.
Essel Group subsidiary Essel Propack is engaged in manufacturing laminated and seamless or extruded plastic tubes.
