Design and packaging firm Graphic Packaging International has agreed to acquire 100% of Australian folding carton supplier Colorpak.
Under the agreed terms, Graphic Packaging would pay $0.68 per share inclusive of a fully franked dividend of up to $0.11 per share to Colorpak shareholders, valuing Colorpak at $60m.
Colorpak operates three facilities in Melbourne and Sydney in Australia; and Auckland, New Zealand which have a combined capacity to convert close to 38,000 tons of paperboard into folding cartons every year.
The folding cartons manufactured at these facilities will be supplies to the food, beverage and consumer product markets.
Graphic Packaging president and CEO Michael Doss said: "Similar to our strategy inthe US and Europe, we are committed to growing our business in developed food andbeverage end markets and optimizing our global supply chain.
"While Graphic Packaging currently has a well-established presence in Australia, the acquisition of Colorpak and its three world class folding carton manufacturing facilities allows us to expand our proven integrated supply chain in the Australia and New Zealand food, beverage and consumer product markets. This acquisition will broaden our customer base and offer current customers a wider range of products."
Subject to Colorpak shareholder approval, court and regulatory review, and standard closing requirements, the acquisition is expected to be completed in the second quarter this year.
Colorpak chairman Geoff Willis said: "Colorpak's Board considers the proposal highlights the strategic value of our business and provides an opportunity for our shareholders to realise the value of their holdings at an attractive price.
"We have been advised that Mr Alex Commins, the current managing director of Colorpak and Mr Sid Troiani the current chief financial officer, will remain in their roles and assume responsibility for Graphic Packaging International's growth ambitions in Australia and New Zealand."
Graphic Packaging recently completed the acquisition of Mexican folding carton producer G-Box.
