Treofan Group - a large, global maker of oriented polypropylene film, but one troubled by a heavy debt load - has gained approval from the European Commission for an ownership transfer to a U.S. equity firm.
Treofan, based in Raunheim, Germany, will be sold to New York-based investment firm Goldman Sachs and several other financial groups. The new owners will acquire Treofan's debt, valued at more than 83 million euros ($101.6 million), the majority of which had been owed to Goldman Sachs, according to a Treofan news release.
The sale is expected to close by mid-August, the company said. The EU approved the sale Aug. 1.
Treofan has been restructuring its operations since April, when negotiations started with Goldman Sachs. The firm was formed in 2002 by merging three worldwide film producers: Trespaphan GmbH, Shorko Australia Pty. Ltd. and Dor Moplefan Group SpA.
The company had been co-owned by Dor Chemicals Ltd. of Haifa, Israel, and Boston-based equity firm Bain Capital LLC.
Dor and Bain will retain a minority stake in the firm. Goldman Sachs said it would provide better financial terms to Treofan and work to increase liquidity.
Treofan claims to be one of the world's largest makers of cast PP and OPP films, producing about 628 million pounds of capacity annually. The company's only North American production facility is in Zacapu, Mexico, although the company has said for several years that it would like to expand production on the continent.
Affiliates of Goldman Sachs also own part of packaging company Berry Plastics Corp. While OPP film has been a difficult end of the packaging business for the past several years, the investment firm normally puts its money in companies it considers short-term growth prospects, several analysts said.
Treofan film is in packaging for snack foods, baked goods, chocolate bars and candy. The company also makes packaging film for tobacco products and to wrap metalized capacitors and coils.
