EPL Limited and Indovida India have agreed to merge their businesses, with the boards of both companies approving the move, subject to regulatory, court and shareholder approval.
The combined group is expected to generate annual revenues of $1bn, with an overall valuation close to $2bn.
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Indovida India was supported by Indorama Ventures, which will hold a 51.8% stake of the merged entity, while EPL was supported by Blackstone, which will hold 16.6%.
EPL shares are valued at Rs339 ($3.6) each in the transaction, which is 70% above the most recent closing price.
Indovida’s valuation carries a discount of approximately 35% compared to EPL’s assigned multiple.
Hemant Bakshi will oversee the merged group as group CEO. Sunil Marwah will continue as head of the Indovida business within the combined company, reporting to Bakshi.
Completion of the merger is anticipated within the next 12 months.
The combined company will focus on packaging for emerging markets, with around three-quarters of its revenue coming from these regions.
Synergies are expected in areas such as product range, regional coverage, procurement and supply chains.
Financial projections show that the EBIT [earnings before interest and taxes] margin for 2025 could increase from 12.4% for EPL alone to 13.6% for the merged group. Return on capital employed (RoCE) is set to rise from 18.7% to 20.9%. The amalgamation will be carried out through a formal scheme, with EPL continuing as the listed entity.
Indorama Ventures’ move forms part of its longer-term objective to strengthen its presence in India and expand its packaging operations.
EPL managing director and global CEO Hemant Bakshi said: “This merger helps transform EPL into a broader multi-format packaging platform with unmatched presence in high-growth emerging markets; focused on innovation for large and emerging brands.
“The combined capabilities, customer relationships and global footprint position us to become the partner of choice for customers and drive growth across categories and markets. I am excited to welcome the Indovida team to the EPL family and look forward to building an exciting future together.”
Indorama Ventures Group CEO Aloke Lohia said: “Our initial minority investment in EPL was reflective of our belief that it is an extremely attractive business with great future potential, globally as well as in India.
“Combining Indovida with EPL is the logical next step and enables us to extend that foundation across formats and markets. With our combined scale, supply chain resilience and sustainability capabilities, the merged entity is well-positioned to deliver long-term value to customers and shareholders alike.
“The merger also meaningfully advances Indorama Ventures’ strategic objective of deepening its presence in India, strengthening our downstream packaging footprint and reinforcing India as a key growth market within our global portfolio.”
Earlier this month, Indorama Ventures, Nigerian Breweries, and Genesis Power & Energy Solutions agreed to set up a large-scale recycled polyethylene terephthalate (rPET) facility in Lagos, Nigeria.
The planned site is expected to have the capacity to produce up to 45,000tpa of food-grade rPET resin.
