SYDNEY: Pact Group Holdings Ltd has commenced a sale process in respect of its Contract Manufacturing division, and appointed Citigroup to assist in the sale process.
The Group’s Contract Manufacturing division, which includes the combined businesses of Jalco, Pascoe’s and Australian Pharmaceutical Manufacturers, is a leading supplier of contract manufacturing services in Australia for the home care, personal care and health and wellness segments.
Contract Manufacturing reported sales of $372 million and EBITDA of $25 million in the 2019 financial year.
Commenting on the announcement, Pact Group’s Managing Director and Chief Executive Officer, Mr Sanjay Dayal, said, “We have undertaken a detailed strategic review of our business, including a review of our portfolio. Contract Manufacturing is an attractive business that enjoys leading positions in sectors with strong growth potential. However, Pact’s success over the longer term is dependent on our ability to deliver organic growth and restore margins in the core packaging business while growing our materials handling and sustainability businesses. Divesting Contract Manufacturing will simplify the portfolio and sharpen our focus on driving improved returns in the remaining Group. Importantly, divestment will strengthen our balance sheet and improve our financial flexibility.”
Pact is a leading provider of specialty packaging solutions in Australasia, servicing both consumer and industrial sectors.
Pact specialises in the manufacture and supply of rigid plastic and metal packaging, materials handling solutions, co-manufacturing services and recycling and sustainability services.