Manjushree Technopack to acquire Oricon for Rs 520 cr
ECONOMY & POLICY

Manjushree Technopack to acquire Oricon for Rs 520 cr

Manjushree Technopack Limited (MTL), India's largest rigid plastics packaging manufacturer, has entered into definitive agreements to acquire the plastics packaging business of Oricon Enterprises. Oriental Containers is one of the largest manufacturers of plastic caps & closures and preforms (intermediate form of PET bottles largely used in beverages) in India.

This transaction will double MTL's current market share in the caps and closures segment, making it the market leader, with an installed capacity of nearly 15Bn pieces per annum. The acquisition includes two manufacturing plants in Goa & Odisha, that will augment MTL's existing production capacity. The combined business will have a wider array of moulds, machines and SKUs, and will strengthen unit economics due to operational synergies as well as deepening key customer relationships. The acquisition will also help augment capacity in the preforms segment, where MTL is already the market leader.

Along with gaining access to the preforms and closures market in eastern India, this transaction will help underscore MTL?s overall position as the market leader in the rigid plastics packaging sector in India. The transaction is consistent with MTL?s growth strategy, adding to a track record of successfully creating value from acquiring and integrating businesses. MTL, which has been owned by Advent International since 2018, has seen substantial growth in the last 6 years  expanding its presence from two business segments at the time of investment in 2018, to five business segments today.

The acquisition of the plastics packaging business of Oricon Enterprises Limited is subject to completion of customary conditions, including corporate approvals of Oricon Enterprises Limited.

Thimmaiah Napanda, MD and CEO of Manjushree Technopack Limited, said, "We are excited to bring Oriental Containers under our ownership as we continue our journey of rapid growth and establishing market leadership in the rigid plastic packaging space in India. While we are already the market leaders in three out of the five segments we operate in (preforms, containers, caps and closures, pumps and dispensers, and recycling), this transaction will make us the clear leader in four segments. This strategic move underscores our dedication to delivering unparalleled quality and value to our customers and supporting them as a fully integrated partner for both growth and business continuity planning. I am thrilled at the prospect of successfully integrating the business and the significant growth opportunities this opens up for us as we look to expand further over the coming period."

Adarsh Somani, MD and promoter of Oricon Enterprises Limited said, ?Oriental Containers was nurtured by my father late Shri Rajendra Somani, who pioneered the manufacturing of plastic closures for beverages industries through compression moulding technology for the first time in India. Under the vision of my father and a committed professional team, we have moved strength to strength and created a leadership position backed by our impeccable quality, innovation, services and state-of-the-art infrastructure.

Our Business will complement MTL's existing portfolio and help MTL achieve market leadership in the closures space as well as get a strong foothold in eastern India. Our customers, vendor partners and employees will all benefit from this consolidation and solid eco system built by MTL as they continue their strong growth trajectory.

EY acted as the exclusive M&A advisor to OEL. Phoenix Legal acted as legal counsel to OEL and Khaitan & Co advised MTL.

Manjushree Technopack Limited (MTL), India's largest rigid plastics packaging manufacturer, has entered into definitive agreements to acquire the plastics packaging business of Oricon Enterprises. Oriental Containers is one of the largest manufacturers of plastic caps & closures and preforms (intermediate form of PET bottles largely used in beverages) in India. This transaction will double MTL's current market share in the caps and closures segment, making it the market leader, with an installed capacity of nearly 15Bn pieces per annum. The acquisition includes two manufacturing plants in Goa & Odisha, that will augment MTL's existing production capacity. The combined business will have a wider array of moulds, machines and SKUs, and will strengthen unit economics due to operational synergies as well as deepening key customer relationships. The acquisition will also help augment capacity in the preforms segment, where MTL is already the market leader. Along with gaining access to the preforms and closures market in eastern India, this transaction will help underscore MTL?s overall position as the market leader in the rigid plastics packaging sector in India. The transaction is consistent with MTL?s growth strategy, adding to a track record of successfully creating value from acquiring and integrating businesses. MTL, which has been owned by Advent International since 2018, has seen substantial growth in the last 6 years  expanding its presence from two business segments at the time of investment in 2018, to five business segments today. The acquisition of the plastics packaging business of Oricon Enterprises Limited is subject to completion of customary conditions, including corporate approvals of Oricon Enterprises Limited. Thimmaiah Napanda, MD and CEO of Manjushree Technopack Limited, said, We are excited to bring Oriental Containers under our ownership as we continue our journey of rapid growth and establishing market leadership in the rigid plastic packaging space in India. While we are already the market leaders in three out of the five segments we operate in (preforms, containers, caps and closures, pumps and dispensers, and recycling), this transaction will make us the clear leader in four segments. This strategic move underscores our dedication to delivering unparalleled quality and value to our customers and supporting them as a fully integrated partner for both growth and business continuity planning. I am thrilled at the prospect of successfully integrating the business and the significant growth opportunities this opens up for us as we look to expand further over the coming period. Adarsh Somani, MD and promoter of Oricon Enterprises Limited said, ?Oriental Containers was nurtured by my father late Shri Rajendra Somani, who pioneered the manufacturing of plastic closures for beverages industries through compression moulding technology for the first time in India. Under the vision of my father and a committed professional team, we have moved strength to strength and created a leadership position backed by our impeccable quality, innovation, services and state-of-the-art infrastructure. Our Business will complement MTL's existing portfolio and help MTL achieve market leadership in the closures space as well as get a strong foothold in eastern India. Our customers, vendor partners and employees will all benefit from this consolidation and solid eco system built by MTL as they continue their strong growth trajectory. EY acted as the exclusive M&A advisor to OEL. Phoenix Legal acted as legal counsel to OEL and Khaitan & Co advised MTL.

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