Saudi Arabian firm Takween Advanced Industries has agreed to acquire Savola Group's packaging unit for $242.5m, under an agreement signed in July last year.
The move is in line with Savola's strategy to focus on its core sectors of food and retailing.
Savola Packaging owns the subsidiaries Al-Sharq Plastic Company and New Marina Plastics Company in Egypt.
It is engaged in the production of plastic containers, barrels, bottles and covers, with an annual production capacity of 200,000 tonnes.
Savola Packaging generated SAR91.2m ($24.2m), SAR100.2m ($26.6m)and SAR69.5m ($18.4m) of profits in 2011, 2012 and 2013 respectively.
The transaction is subject to regulatory and Takween shareholders' approval.
Upon completion, the acquisition is expected to provide a qualitative leap in Takween's expansion plans, which should have a positive effect on its financial results and profits.
It is expected that the financial impact will positively reflect on Takween's accounts from the second quarter of 2015.
The acquisition will be financed through a syndicate of Saudi banks, which will be announced later.
Takween Advanced Industries produces and sells packaging products for the dairy and beverage industries in Saudi Arabia and the Middle East region.
Its plastic packaging products comprise polystyrene sheet rolls, thermoformed polystyrene cups and lids, high-density polyethylene bottles and closures and caps.
Image: Takween Advanced Industries produces and sells packaging products for the dairy and beverage industries. Photo: courtesy of Takween Advanced Industries.