The beverage bottler SIG Combibloc is expanding its Asian business. With Evergreen Asia he is expanding into the Chinese dairy market. In addition, two Chinese take part in the group management.
The packaging group SIG Combibloc is expanding in Asia.
The Schaffhausen packaging group SIG Combibloc is taking over the Asian business of the American packaging group Pactiv Evergreen for 335 million dollars. He wants to concentrate on his home market in the future. The acquired business had sales of $ 160 million last year, half of it in China.
The purchase price corresponds to twelve times the adjusted profit at the Ebitda level. Although the margin of the acquired business at 17.5 percent is well below that of SIG Combibloc (27.4 percent), the acquisition will make a contribution to cash flow and earnings per share from the very first year, according to a press release. The somewhat flagging price development of the SIG shares that gave a boost on Wednesday.
The purchase is of great strategic importance for SIG Combibloc. The Asian business has been gaining in importance for years, and this region currently generates a third of the company’s income. With Evergreen Asia, the Swiss are penetrating the lucrative business with milk in cartons for household use in China. A year ago, they opened a state-of-the-art bottling plant in Suzhou. With the change of hands, a long-term delivery agreement for cardboard boxes has also been entered into with Pactiv Evergreen. The bottlers do not earn their money with the filling systems that they make available to the beverage manufacturers, but with every container that is produced.
The importance of China is now also reflected in the company’s management board. This week, for the first time, two Chinese have been on the management board, which has increased to nine members. In the aseptic beverage carton business, SIG Combibloc has consolidated its second place behind the three times larger market leader Tetra Pak (market share 64 percent).