New Scandinavian packaging JV already eyeing future IPO
The new packaging outfit will be made up of A&R Cartons – owned by Finland’s Ahlström Capital - and Flextrus, the Sweden-based outfit owned by Accent Equity.
Arch Packaging’s combined portfolio will cater for the food, beverage, and beauty care industries, as well as tobacco and petfood products.
A&R is a major folding carton supplier and makes a raft of packaging for the food sector – including multipacks and formats for the beverage and confectionery sectors. Flextrus is a flexible packaging outfit for food and healthcare, which operates mainly in northern Europe
The joint venture will have an annual turnover of about €500m and 2,000 employees in 18 factories across eight European countries.
The private partners plan to make “significant investment” into the business that they hope will lead to a future public floatation.
“We are targeting a growth in turnover of around 50 per cent over the next three to five years and we will then take a decision on a possible initial public offering (IPO),” Per Lundeen, president of Arch Packaging and A&R Cartons, told FoodProductionDaily.com.
It was more likely that any floatation would take place on one of the Nordic stock exchanges, he added.
In the meantime, Arch packaging would aim to “grow both organically and by acquisition,” said Morten Ahlström of Ahlström Capital.
Separate companies, more innovation
Arch confirmed that the constituent companies would continue to operate as separate entities and brands.
“A&R Carton and Flextrus will continue to do business as two separate companies on the market but will collaborate where this offers advantages,” said Jan Ohlsson of Accent Equity Partners AB. “This will give the companies a stronger base for development of new innovative packaging solutions and in the ongoing restructuring of the packaging market.”
A&R Cartons was previously one of Flextrus’ largest customers and it will continue to buy materials for conversion into packaging.
The new owners are also eager to use the joint expertise of the two companies to boost innovation. Areas already identified include a variety of tray products and barrier coating technology, said Lundeen.
The new group will be headquartered in the Swedish city of Malmo.
Ahlström will be the majority shareholder in Arch with a 62 per cent stake, while Accent will hold 34 per cent. The remaining 4 per cent of shares will be owned by senior executives in the venture.
Private equity company Capman will divest its interest in A&R Cartons, should the deal be approved by the competition authorities, said Arch Packaging.
