Billerud, a prominent sustainable fiber-based packaging materials company, has recently announced its decision to divest Managed Packaging, a business unit that offers packaging solutions to global brand owners. The company has reached an agreement with Mimir Group, a specialist investment firm focused on acquiring divisions, business units, and product areas from large corporations and government entities. Mimir Group specifically targets companies with up to EUR 1 billion in sales, seeking opportunities for value creation as stand-alone enterprises.
The transaction, which is expected to be completed in August 2023, aligns with Billerud’s strategic focus on packaging materials and its reduced emphasis on service offerings. By divesting Managed Packaging, the company aims to simplify its operations, reduce complexity, and positively impact its EBITDA margin.
Christoph Michalski, President and CEO of Billerud, emphasized the rationale behind the divestment, stating, “Managed Packaging has contributed to Billerud with expertise in optimization of fiber-based packaging solutions for global brand owners, but there are no synergies with our core business, which is our focus in the years to come. Managed Packaging will now get an owner who wants to develop the business, to the benefit of employees and customers.”
The completion of the transaction, scheduled for August 2023, is expected to yield a positive result effect for Billerud, approximately SEK 20 million. This effect will be reported as an item affecting comparability in the third quarter. The impact of the planned divestment on Billerud’s EBITDA and net debt is projected to be immaterial.
Managed Packaging, the business unit being divested, specializes in providing customized packaging solutions to global brands and retail chains, with manufacturing operations predominantly based in Asia. The division boasts an extensive network of production partners. With 143 employees spread across Asia, Europe, and the USA, Managed Packaging reported net sales of SEK 770 million in 2022, falling under Billerud’s Solutions & Other segment. Billerud initially acquired a 30% stake in Managed Packaging in 2011, gradually acquiring the remaining 70% in 2013.