Pact Group will acquire parts of the Asian packaging operations of Closure Systems International (CSI) and Graham Packaging Company (GPC) from Reynolds Packaging for $142 million in cash.
The move will increase the size of its Asian business from $50 million to $200 million, and is part of the packaging company's plan to reinvent itself by generating a greater presence in Asian markets.
CSI designs and manufactures high-speed capping systems while GPC produces plastic bottles.
The acquired businesses have seven manufacturing sites across China, South Korea, Nepal, India and the Philippines, according to Pact Group.
Innovation and product development manager Lachlan Patton said the partnership would offer Australian and New Zealand water, carbonated soft drinks (CSD), functional beverage and juice customers access to global closure technologies, designs, and research and development.
“Consumers and bottlers are continually seeking to use packaging that reduces environmental impact,” he stated.
“With CSI as our partner, Pact Group is now better positioned to source and manufacture a wide range of high-performance, lightweight closure solutions.”
Pact chief executive Malcolm Bundey told the The Australian Financial Review that while the group is already in the capping systems business, the Asian acquisitions would give it a much stronger regional presence.
"We are in that business today with various customers, but it gives us much more size and scale," he said.
"We do get a broader set of customers that these businesses are dealing with, and we get some differentiated technology that's used in the region.
Bundey said it was also important the deal brought with it a management team based in Asia.
Currently Pact's Asian businesses, including plants in China, Indonesia and the Philippines, are run from Melbourne.
"What we get is a sound and robust management team in the region and a lot of local resources," he said.
The company, with a market value of about $1.74 billion, is also expanding its footprint in Australia through an agreement to buy West Australian tank and drum business ECP Industries for $11.7 million.
