European packaging manufacturer Smurfit Kappa has strengthened its wine packaging capacity with the takeover of the Portuguese specialist bag-in-box maker Litbag Lda.
The Irish paperboard packaging group agreed to purchase the young business, operating in Vizela in the Braga region of northern Portugal, to boost its presence in southern Europe. The value of the deal was not disclosed.
Litbag, only founded in 2014 by its chief executive Modesto Araújo, has developed a business successfully offering a range of bag-in-box containers, with volumes from 2 to 20 litres. It is a leading supplier to the regional wine market.
The firm has expertise in developing multi-layer EVOH barrier films to enhance product shelf life and also serves the water, olives and juice markets. Litbag exports its packaging to Spain and France as well as meeting local Portuguese demand.
Bag-in-box is showing “significant potential growth for our group”, Roberto Villaquiran, chief executive of Smurfit Kappa Europe commented on the deal.
“Product differentiators like their (Litbag’s) film performance and our ‘Vitop’ tap technology will significantly strengthen our capabilities when we they come together,” added Thierry Minaud, CEO of Smurfit Kappa’s bag-in-box business.
The acquisition means the Irish group will have two bag-in-box operations in the Iberian peninsula. In 2014, the Irish group invested €28m to establish a new dedicated plant at Ibi in south eastern Spain.
That facility, inaugurated in November 2014, includes highly automated manufacturing lines and integrates production of bag-in-box plastic taps and multi-layer polyethylene bags under one roof. It can turn out several million taps and bags per month.
Smurfit Kappa makes bag-in-box containers of 2 to 1,000 litres capacities with tamper proof taps and multi-layer polyethylene bags. The group has grown its global production footprint and will have 15 plants, mostly European, but also in Argentina, Mexico and Canada with Litbag.
Its other European operations are located in Italy, France, Germany, the UK, Sweden, Romania, Poland and Russia.