RUSSIA – Paper and packaging company, Mondi has entered into an agreement to sell its three Russian packaging converting operations to Gotek Group for about US$25.5 million (€24m), payable in cash.
Gotek Group is a packaging producer based in Moscow, Russia and employs around 2,200 employees across its business.
The three packaging converting operations include a corrugated solutions plant and two consumer flexible plants. These plants produce a range of packaging solutions for the domestic Russian market.
Mondi stated that the loss on the disposal is expected to be in the range of US$ 74.39- 85.01 million (€70-80m) at the current exchange rate.
The deal is anticipated to be completed in the first half of 2023, subject to the approval of the Government Sub-Commission for the Control of Foreign Investments of the Russian Federation and usual antitrust approvals.
Mondi said that there can be no assurance that the disposal will be finished, though, because it is being carried out in a political and regulatory climate that is constantly changing.
The sale comes after Mondi declared in May this year that after weighing all of its alternatives regarding the group’s holdings in Russia, it had decided to sell its Russian assets.
According to the packaging firm, the sale is unrelated to the proposed sale of Mondi Syktyvkar, which has not yet received the necessary antitrust licences and approval from the Russian Federation’s Government Sub-Commission for the Control of Foreign Investments.
As Mondi contracts in Russia, the company has moved to simultaneously broaden its geographic reach.
In August it agreed to acquire the strategic Duino mill in Italy from the Burgo Group for a total consideration of US$ 42.51 million (€40m).
The mill, located near Trieste in Italy, is a strategic asset because of its proximity to two important export harbors, with Mondi highlighting that Duino is ideally located to supply its Corrugated Solutions plants in Central Europe and Turkey, as well as to serve the growing Italian market.
Following the acquisition, Mondi plans to convert this paper machine to produce around 420,000 tonnes of recycled containerboard per year through an investment of US$202.97 million.
Meanwhile, Mondi has collaborated with FRESH!PACKING to develop a new recyclable consumer cooler bag.
The Fresh!Bag is intended to protect and transport chilled or frozen goods home by consumers.
Made entirely from Mondi’s durable kraft paper, the bag is certified as fully recyclable in existing European paper waste streams.
The bag also has high stretchability to allow easy sewing of the different plies to create a strong bag structure.
Mondi Specialty Kraft Paper international sales manager Alexander Baars said: “Fresh!Bag provides a genuinely exciting opportunity for retailers; it responds to the consumer demand for more sustainable packaging while delivering convenience and durability for frozen and chilled goods.”
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