A major Australian stretch film and flexible plastics manufacturer’s owner has engaged a private bank to investigate a potential sale.
Melbourne-based Integrated Packaging Group Pty. Ltd. (IPG) is 92% owned by Melbourne-based private equity investment firm Advent Private Capital Pty. Ltd.
Rob Archibald, IPG’s sales and marketing manager, confirmed to Plastics News that Advent has asked the Australian arm of Swiss-based Credit Suisse Group AG to “search the market” to identify companies interested in buying IPG.
Archibald said Advent has had informal approaches from potential buyers from the United Kingdom, Europe, Asia and Australia. Advent is “looking for an exit strategy” so decided to have a formal process by engaging Credit Suisse.
Archibald confirmed A$200m (€144m) is a reasonable price, saying “Advent would look at an offer like that.” IPG projects its sales for the fiscal year ending 30 June will be A$220 million. Archibald will not disclose the profit level, saying Advent is “a private company and they like to keep things close.”
Archibald and other management, including CEO John Cerini, own the remaining 8% of IPG. Advent boosted its stake in the company in 2011, with an investment of A$50 million.
Archibald said a sale is the preferred option for IPG’s future. “It’s cleaner and neater for Advent.” But an Australian Securities Exchange listing is possible if the right buyer cannot be found.
He said it is “the right environment to test the market.
“We’re viable and there’s currently talk about packaging companies doing better after going through” some challenging years.
Archibald expects a sale could take six to 12 months to finalise.
IPG is headquartered in the Melbourne suburb of Reservoir. In 2012, it bought the business and assets of Melbourne-based, publicly listed packaging giant Amcor Ltd.’s flexibles packaging unit, adding plants in Cheltenham, Chester Hill and Kirrawee, Australia.
The same year it bought Amity Agricultural Canada, which now operates as IP Canada Packaging Group Pty. Ltd., in Lethbridge, Alberta.
IPG, launched in 1982, claims it is Australia’s largest specialist manufacturer and distributor of stretch film wrap and associated products and has expanded into printed polyethylene products and PVC food films. Agricultural packaging is a specialist line for IPG.
Cerini and Archibald share strong plastics packaging industry experience. Cerini has been CEO since 2003 and, before joining IPG, was a senior executive with Amcor for 10 years and CEO of Detmold Packaging, part of the Adelaide Detmold Group, for five years.
Archibald joined IPG in 2005 after senior roles with Amcor and Detmold. Amcor bought Detmold Group’s Detmold Flexibles unit in 2014.
IPG includes an Integrated Machinery division, established in 1990 to manufacture of stretch wrap film and equipment, and Integrated Recycling, which recycles and used PE-based plastics.