Paper and plastic products manufacturer Intertape Polymer (IPG) has entered a definitive agreement to acquire the operating assets of Nortech Packaging.
The deal is valued at a cash consideration of approximately $36.5m depending on certain post-closing adjustments and potential earn-out consideration.
IPG president and CEO Greg Yull said: “Packaging automation and system design are playing an increasingly important role in our customer’s competitive positioning, especially in the e-commerce market. We believe this acquisition will provide us with the opportunity to move upstream in our target customer’s production process with an expanded product bundle and a continuous supply of consumables.
“This acquisition delivers on both fronts. We remain committed to paying down debt moving forward as our cash flows improve with contributions from our recent CapEx investments and our earlier acquisitions. At the same time, we will continue to be disciplined in our approach to acquisitions that strengthen our product bundle or offer strategic benefit to IPG, meeting our customer’s needs.”
The acquisition will improve IPG’s products that are increasingly important in packaging automation.
In addition, the deal will add engineering automation and integrated robotic design talent to IPG’s existing engineering and design teams.
The deal is expected to be completed in the first quarter of 2020. It is subject to customary closing conditions and approvals.
Based in Chicago, Illinois, US, Nortech specialises in manufacturing, assembling and servicing automated packaging machines under the Nortech Packaging and Tishma Technologies brands.
The company has customers in various sectors including food, pharmaceutical, e-commerce, confections, personal care, cosmetics, and beverage.