US-based paper and packaging company WestRock has entered an agreement to take over the remaining interest in recycled paper and cardboard packaging manufacturer Grupo Gondi.

Westrock will pay $970m, plus the assumption of debt, taking Grupo Gondi’s enterprise value to around $1.76bn.

The company currently holds a 32.3% stake in Grupo Gondi.

Grupo Gondi manufactures sustainable packaging for a diverse range of end markets in Mexico.

The company operates a network of four paper mills, nine corrugated packaging plants and six high graphic plants across the country.

The acquisition is in line with WestRock’s capital allocation and acquisition framework.

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It is intended to strengthen the company’s position in Latin America’s growing containerboard, paperboard and consumer and corrugated packaging markets.

WestRock CEO David B Sewell said: “Acquiring the remaining interest in Grupo Gondi is the next strategic step in our broader North American paper and packaging expansion strategy.

“As onshoring continues to grow in the region, WestRock will be well-positioned to meet this growing demand with fully integrated operations in Mexico.

“We will also have expanded capabilities to serve customers across many geographies, driving additional productivity and cost savings.”

Grupo Gondi president and board chairman Alejandro González Cimadevilla said: “WestRock and Grupo Gondi have been great joint venture partners over the past six years, working together to provide outstanding service and innovation for our customers.

“Becoming part of WestRock, with its scale, geographic footprint and customer-focused solutions, will further enhance our ability to provide complete packaging solutions for our customers.”

The deal is expected to close by the end of this year subject to various customary closing conditions being met, including approval by regulatory authorities in Mexico.

In April this year, WestRock revealed plans to permanently close operations at its mill in Panama City, Florida.