Denmark-based Brødrene Hartmann A/S (Hartmann) has entered into an agreement to fully acquire Punjab-based Mohan Fibre Products Ltd, a provider of moulded fibre packaging for fruits and poultry in India.
Hartmann said it has agreed to acquire Mohan Fibre for Danish Krones(DKK) 119 million (around $17.55 million, or Rs 125.22 crore at current exchange rates), the company said in a filing with Nasdaq Copenhagen.
The acquisition, financed through Hartmann’s existing credit facilities, marks the Denmark manufacturer’s entry into the Indian market. The transaction is expected to be completed by the middle of this year, subject to regulatory approval.
Torben Rosenkrantz-Theil, chief executive officer at Hartmann, said the acquisition marks a strategic decision to enter into the great Indian market in which we see significant growth potential.
“Mohan Fibre is a profitable company and will improve our earnings from day one,” he said.
Hartmann says Mohan Fibre is expected to generate revenues of around DKK 75 million (around Rs 78.94 crore) and EBITDA earnings of DKK 13 million (around Rs 13.68 crore) for the 2019 financial year.
The acquisition is in line with the manufacturer’s ‘Think Ahead’ strategy involving investments in emerging markets. The company says it expects to complete several capacity-expansion moves this year, including in Europe, the United States and Brazil.
Global professional services firm Ernst & Young (EY) acted as the exclusive financial advisor to Mohan Fibre for the transaction, according to a Mint report.
Mohan Fibre’s founders ventured into the paper pulp moulding industry in 1979, with the company itself beginning operations from its Mubarakpur facility in 1990. The firm says it provides moulded fibre packaging for apples and eggs. It also provides plates, bowls and trays that are used by caterers, clubs, banquet halls and restaurants, according to its website.
Brødrene Hartmann, meanwhile, was founded in 1917 and says it is the world’s leading manufacturer of moulded fibre egg packaging. It has close to 2,000 employees, and also claims to be the largest fruit packaging producer in South America through its Sanovo Greenpack division. It was listed on the Nasdaq Copenhagen in 1982.
