Sustainable Packaging M&A: Graphic Packaging Acquires AR Packaging for $1.45 Billion
Fiber-based consumer packaging solutions Graphic Packaging announced today an agreement to acquire Sweden-based AR Packaging Group AB, Europe’s second largest producer of fiber-based consumer packaging, for approximately $1.45 billion in cash from CVC Capital Partners.
The acquisition comes as demand for sustainable packaging solutions is seeing rapid growth, as companies increasingly incorporate waste reduction and circular economy goals into their ESG strategies. Fiber-based packaging solutions are seen as a key tool to replace harder to recycle plastic across several food and consumer sectors.
Michael Doss, Graphic Packaging’s President and CEO said:
“AR Packaging is a leader in the attractive and growing market for sustainable packaging in Europe. Acquiring AR Packaging will result in significant value creation opportunities for our customers, our employees, and our stockholders as we bring together two leading providers of fiber-based consumer packaging solutions with long histories of innovation and creative packaging design.”
AR Packaging’s President and CEO, Harald Schulz added:
“Graphic Packaging’s shared approach to customer service and deep focus on providing innovative, sustainable solutions closely aligns with how we operate our own business, making them an ideal partner. The ability to leverage beneficial value chain integration, from paperboard manufacturing to carton converting, provides increased possibilities to offer sustainably optimized solutions to our customers. Our team looks forward to joining with the Graphic Packaging team to become the premier global provider of sustainable fiber-based packaging solutions.”
The acquisition marks a significant expansion for Graphic Packaging into the market for fiber based packaging in Europe, one of markets seeing the strongest demand for sustainable solutions. According to Graphic Packaging, new product launches with ethical claims are five times higher in Europe than North America.
“The large, distributed footprint of AR Packaging’s 25 converting facilities across Eastern and Western Europe provides significant scale and cost efficiency benefits strengthening our combined presence and ability to service customers throughout Europe and globally.”
The transaction is expected to close in four to six months, subject to regulatory approvals and other customary closing conditions.