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Paper and packaging group Mondi (MND) is to acquire 93.4% of the outstanding share capital of Nordenia International from funds managed by Oaktree Capital Management‚ LP and certain other minority shareholders for a total cash consideration of EUR240m.

In addition‚ Mondi will assume EUR398m of debt and debt-like liabilities‚ implying an enterprise value for 100% of the company of EUR655m.

Nordenia is an international supplier of innovative consumer packaging solutions and hygiene components‚ with 12 fully invested operating facilities in seven countries across Europe‚ North America and Asia.

Additionally‚ a wholly owned greenfield plant is being built in China and is expected to begin operating in early 2014.

Based on Nordenia’s earnings before interest‚ tax‚ depreciation and amortisation (EBITDA) and EBIT for the year ended December 2011‚ of EUR99m and EUR70m‚ respectively‚ the implied enterprise value equates to 6.6 times 2011 EBITDA and 9.3 times 2011 EBIT‚ Mondi said on Wednesday.

The EUR240m cash consideration payable for the acquisition would be funded from a new EUR250m two-year committed bank debt facility‚ Mondi said.

The acquisition is expected to complete in the fourth quarter of 2012‚ subject to customary completion conditions including the approval of certain competition authorities.

Mondi CE David Hathorn said: “The acquisition of Nordenia offers Mondi Group a unique opportunity to create a leading consumer packaging business‚ build on long-term customer relationships across both businesses and establish a platform to expand further in high-growth emerging markets.”

Consumer packaging solutions contribute approximately 60% of Nordenia revenue‚ and include re-closable bags‚ stand-up pouches‚ advanced films and laminates for mainly fast-moving consumer goods. Hygiene components contribute approximately 40% of Nordenia revenue‚ and include components of nappies and feminine hygiene products. In 2011‚ sales to the fast-moving consumer goods sector accounted for more than 90% of Nordenia revenue.

Following the completion of the acquisition‚ Mondi will reorganise its Europe and international division into four businesses: uncoated fine paper‚ packaging papers‚ fibre packaging and consumer packaging.

Nordenia will form part of the consumer packaging business‚ which will be led by Nordenia CEO Ralph Landwehr. - I-Net Bridge