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March 17, 2022

Brookfield to buy minority stake in Jindal Poly Films business

Jindal Poly Films will retain a 75% stake in the new business unit.

Canadian investment management firm Brookfield Asset Management has agreed to purchase a minority stake in Indian fabric company Jindal Poly Films’ (JPFL) packaging films business for Rs20bn ($263m).

JPFL supplies a full suite of products, including biaxially oriented polypropylene films (BOPP), biaxially-oriented polyethylene terephthalate (BOPET), cast polypropylene (CPP) and other specialised films.

These are used in packaging for food and cosmetics, labels, tapes and other segments.

In addition, the company offers non-woven fabrics for various applications, including hygiene, nappies and medical products.

As part of the agreement, JPFL will create a wholly owned subsidiary named JPFL Films from its packaging films business.

Brookfield’s Special Investments programme (BSI), together with institutional partners, will buy a 25% stake in JPFL Films, while JPFL will retain the remaining shares.

BSI managing director Dev Santani said: “We are pleased to partner with JPFL, India’s leading manufacturer of flexible plastic films for the packaging industry, which plays an essential role in the preservation and hygiene of products in different sectors such as food and healthcare.

“In partnership with Jindal, we aim to help the company maintain its strong track record of growth.

“BSI is sector agnostic and invests in large-scale, non-control (minority) investments where we can provide capital and be a strategic partner to leading companies.

“We intend to continue to scale our BSI investments in India and be a partner of choice.”

JPFL’s packaging business generates approximately 85% of its total revenue.

Following the deal, the company will continue to own its non-woven business unit and other corporate assets.

The transaction is subject to customary approvals and is expected to complete in the first half of the next fiscal year (FY23).

Besides the acquisition, Brookfield and JPFL have also signed an investor rights agreement.

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