Private equity firm buying Montreal-based rigid packaging molder IPL Plastics
The deal between Madison Dearborn Partners and IPL is subject to approval from at least two-thirds of shareholders and IPL not securing a better offer from another company within 30 to 40 days.
Montreal-based in-mold labeled packaging and bulk plastic containers manufacturer IPL Plastics Inc. has been acquired by Chicago-based private equity firm Madison Dearborn Partners LLC.
The transaction values IPL Plastics at $555 million (Canadian) on an equity basis and at $981 million on an enterprise basis.
IPL Plastics – formerly known as One51 – manufactures a range of plastic products, from food containers and pails to wheelie-bins.
In a statement, Rose Hynes, a non-executive director and chair of a special committee that assessed the bid, said it had concluded that the deal is in the best interests of IPL Plastics and fair to its shareholders. “With a view to maximizing shareholder value we conducted a thorough assessment of [Madison Dearborn’s] proposal, as well as other alternatives reasonably available to the company, including the status quo,” Hynes said. “Following this comprehensive assessment and our extensive negotiations with [Madison Dearborn], we are pleased to have reached an agreement that provides immediate and fair value to shareholders and includes significant procedural safeguards that protect minority shareholders.”
The deal is subject to approval from at least two-thirds of shareholders and IPL not securing a better offer from another company within 30 to 40 days under a clause – known as a “go shop” provision – attached to the agreement with Madison Dearborn.
IPL was founded in 1939 as a small manufacturer of household items. Today, the company has 14 manufacturing facilities in North America, Europe, and China that operate a total of more than 400 injection molding machines, plus three R&D facilities in Canada and the U.S.