Packaging products and systems company Intertape Polymer Group (IPG) has completed the acquisition of the remaining 26% interest in India-based packaging tapes manufacturer Powerband Industries for $9.9m.
Following the completion of the transaction, IPG will own all of the issued and outstanding common shares of Powerband, which is subject to approval from the Indian regulatory.
This transaction stems from the company’s agreement signed in September 2016 to purchase a 74% controlling stake in Powerband for $42m.
The option was held by IPG under a shareholders agreement with Powerband’s minority shareholders.
Following this deal, IPG announced plans to invest $18m-$20m to expand Powerband business by establishing a greenfield facility in Dahej, India.
This expansion focuses on producing carton-sealing tape to cater to the North American and European markets. Construction of the facility, which is currently under the final phase, is expected to complete in the first half of next year.
IPG president and CEO Greg Yull said: “By exercising our option, we have simplified the governance structure of the Powerband subsidiary. Most importantly, the transaction provides us with a 100% interest in the cash flows from the business.
“Acquiring a controlling interest in Powerband in 2016 provided us with additional capacity for acrylic carton-sealing tapes in a low-cost manufacturing region with the goal of exporting these competitively priced tape products to North America and Europe.
“Since that time, having this overseas asset has enabled us to expand our market share in North America and negotiate better terms on raw materials for our US production of similar packaging tapes.”
Earlier this year, the company transitioned all management responsibilities to an IPG-appointed management team.
IPG and its subsidiaries operate in the packaging industry in Canada, the US, and internationally. It has 20 manufacturing facilities in North America, two in Asia and one in Europe.