China

Huhtamaki acquires IP’s Chinese paper business

By RJ Whitehead

- Last updated on GMT

Huhtamaki acquires IP’s Chinese paper business

Related tags: Manufacturing, East asia

Memphis-headquartered International Paper (IP) has announced the completion of the sale of its foodservice business in China to Huhtamaki Group for an estimated EUR15m (US$18m).

Huhtamaki, a foodservice packaging business based in Finland with 74 manufacturing units and 24 sales offices in 34 countries, bought two manufacturing plants in Shanghai and Tianjin from IP. 

These employ some 200 people and make one-time-use food containers for restaurants and other retail outlets.

The Finnish company said before the completion that the deal would strengthen its position as the leading foodservice packaging provider in China by expanding its manufacturing footprint into the east of the country. 

"It strengthens our operations in China significantly, both geographically and from a capacity point of view, allowing us to serve our customers even better in the future​." Its chief executive, Jukka Moisio, said. 

The product range of the units to be acquired is similar to those currently manufactured by Huhtamaki in China, including paper cups for hot and cold beverages, food containers and snack food and ice-cream containers. 

IP’s China business was worth US$22.8m in 2016 and will become part of Huhtamaki's Foodservice Europe-Asia-Oceania business segment.

"We have an ambitious growth strategy​," said Eric Le Lay, its executive vice-president, when the deal was announced in June.

"This acquisition consolidates our business in North Asia and offers good possibilities to boost our growth. In addition, with the footprint expansion we improve our coverage of the vast market of China, which is good for our customers."

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