Finnish packaging and labeling company Huhtamaki has reached an agreement to acquire the Turkish company Elif, a major supplier of sustainable flexible packaging to global brand owners, it announced Monday.
Huhtamaki will acquire the Turkish packaging company that runs operations in Turkey and in Egypt for a cash-free, debt-free purchase price of 412 million euros (around $483 million), the company said.
To support the financing of the acquisition, the Finnish firm’s parent company, Huhtamaki Oyj, signed a bridge financing facility of $500 million with Citi, who has also acted as an advisor in the transaction.
Elif will become part of Huhtamaki’s Flexible Packaging business segment. With the acquisition, the company said it reinforces its position as a leading flexible packaging company in emerging markets and strengthens its existing flexible packaging business in attractive consumer product categories.
The investment also expands Huhtamaki's flexible packaging manufacturing footprint in Turkey, one of the top future growth countries, the company said.
With the vast majority of Elif’s product range already recyclable or compostable, the acquisition is also a significant milestone in reaching Huhtamaki’s ambition to have 100% of its products designed to be recyclable, compostable or reusable by 2030, it noted.
"With a great portfolio, a strong focus on sustainability and high growth ambitions, Elif is a perfect fit for Huhtamaki," said Charles Heaulme, president and CEO of Huhtamaki.
Heaulme stressed their 2030 growth strategy is particularly focused on sustainability and competitiveness, which he said Elif strongly supports.
"We are looking forward to building on the existing strong foundations together, to grow the business further and deliver innovative sustainable packaging solutions to current and new customers globally."
For his part, Selçuk Yarangumelioğlu, CEO of Elif, said the company has always been a dedicated partner for multinationals and that under new ownership, "we will continue to deliver sustainable solutions to our customer base globally, enhance our focus on fast-growing emerging markets, realize synergies through scale and expand our capabilities."
Founded in 1972, Elif is a long-term partner for major global consumer brand owners in Europe, Middle East and Africa.
Specialized in high-quality sustainable flexible packaging, it uses both post-industrial and post-consumer recycled polymers as raw materials. It also has an advanced system of collecting and utilizing production scrap from both its own as well as from customer locations.
More than 90% of Elif’s current product portfolio is recyclable and the product portfolio also includes compostable films. Its products are being used in more than 200 production sites in over 50 countries.
Elif’s net sales amounted to approximately 163 million euros in 2020. It employs around 1,500 people in its two manufacturing locations in Istanbul, Turkey and Cairo, Egypt.
Huhtamaki operates in 36 countries and 82 sites around the world. It has around 18,200 employees. Its 2020 net sales totaled approximately 3.3 billion euros, according to the company.
The transaction is subject to the approval of competition authorities in Turkey, and it is expected to be closed after regulatory approval.