Dive Brief:
- KPS Capital Partners announced an agreement Monday to acquire MM Packaging for an enterprise value of 2.4 billion euros, about $2.68 billion.
- KPS is acquiring the business from Austrian fiber packaging manufacturer Mayr-Melnhof Karton AG, known as MM Group, which will retain a 30% stake. MM Group noted that its equity interest could be reduced to 20% if certain earnings targets next year aren’t met.
- MM Group said the packaging business “already operates largely independently,” and upon closing MM Packaging will become a standalone company.
Dive Insight:
Global board, paper and packaging manufacturer MM Group spans 50 sites in 19 countries. It lists six plants in the United States: one in Indianapolis, three in North Carolina, and two in Puerto Rico. They make folding cartons, labels, leaflets and printed aluminum foil.
End markets include food and beverage, beauty and personal care, and household care. MM also describes itself as “the world's largest producer of secondary pharmaceutical packaging,” a market that’s accelerating thanks to growth in GLP-1s.
“MM Packaging is an industry-leading business, and we are excited to take it to the next level as an independent company,” said Michael Psaros, co-founder and co-managing partner of KPS, in a statement. “KPS has had extraordinary success investing in the packaging sector across paper, board and metal substrates. We will leverage our deep industry experience, financial resources, commitment to manufacturing excellence and global presence to drive MM Packaging’s growth.”
Going forward, MM Group will focus on its struggling board and paper business, which has been pressured this year by “persistent market overcapacity” and “sharply rising energy costs,” according to a recent quarterly earnings report.
Demand from the packaging business could help MM’s paper and board business.
MM Group said there will be a long-term agreement for the board and paper business to supply cartonboard to MM Packaging.
MM Group expects net cash between 800 million and 900 million euros when the transaction is finalized. That will go toward debt repayment and a 500 million to 600 million euro special distribution to shareholders.
New York-based private equity firm KPS is no stranger to major packaging deals, having previously held packaging companies such as Eviosys and Anchor Glass. Eviosys was created through a carve-out from Crown Holdings in 2021, which it ultimately sold to Sonoco for $3.8 billion in 2024. Previously, KPS invested in Anchor Glass in 2014 and sold it in 2016 to PE firm CVC Capital Partners and European glass bottle manufacturer BA Glass for more than $1 billion.
The MM deal is the latest spinoff and private equity partnership in the packaging industry in 2026. In an example last month, Silgan announced a complex transaction in partnership with New York-based PE firm American Industrial Partners. It involves re-homing Silgan’s metal containers segment and food and beverage flat-cap closures businesses by combining them newly acquired European metal packaging specialist Trivium Packaging, giving Silgan a 60% share in the new company and AIP a 40% share.
