Formica Laminates has announced the acquisition of the laminate unit of Well Pack Papers & Containers for about Rs500m ($9m).
Formica India country head Sanjay Badri told Financial Chronicle that the transaction is a part of the US-based company's Indian expansion plans.
"We want to build our presence in India using the expertise and market access of Well Pack Papers & Containers," Badri said.
Well Pack Papers & Containers, based in Gandhinagar, India, manufactures packaging materials, kraft paper and corrugated boxes, and the company's move to sell its laminate unit is in line with its restructuring plan.
Part of New Zealand-based Fletcher Building Products group, Formica entered the Indian market in 1966 and established a manufacturing plant at Pune, Maharashtra, which was sold later to Nusli Wadia group company, Bombay Burmah Trading (BBTC) in 1977.
In 2010, the company re-entered in a bid to capture around 5% of the estimated Rs20bn ($365m) laminate products market in the next three years.
At present, Formica has a manufacturing plant in Ahmedabad, which can manufacture around 100,000 sheets monthly.
Formica group, which was acquired by Fletcher Building Products Group in 2007 for $700m, has ten manufacturing facilities spread across North America, Europe and Asia.
Well Pack Papers & Containers has a 13,200 million tonne per annum kraft paper manufacturing unit capacity and a corrugated box manufacturing plant with 2,400 million tonne per annum capacity.