02.05.2013

Sun Capital Partners

Private equity firm Sun Capital Partners plans to merge five of its plastic packaging portfolio companies to form what it says will be the sixth-largest plastic packaging company in the world. The new company, which will be called Exopack Holdings Sarl, will be created by merging its Exopack, Kobusch, Britton, Paragon and Paccor businesses, the company said in a filing with U.S. regulators on Wednesday.

The combined revenue of all the companies was around $2.5 billion in 2012, Exopack said. The deal will generate annual savings of around $65 million from efficiencies generated in its back office, manufacturing and global procurement operations, it said. The companies had around $255 million in total EBITDA last year, Jack Knott, who will be chief executive of the new Exopack, said in an interview. That would translate to around $319 million after the cost savings, he said. "This gives us a lot of optionality that we didn't have before," Knott said. "It gives us optionality to continue to grow through acquisitions in different geographies and different market segments. It gives us optionality to continue to invest in organic growth, which we've done quite well in." Knott said the larger company will also give it more options in raising capital for the new company.

The deal will combine packaging businesses with operations in Europe and the Middle East with Exopack, which was previously focused on North America. It will create a company with 63 plants and 8,650 employees The new Exopack will be based in Luxembourg.


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