Shanghai-based plastics processor HCP Packaging has a new owner, with Baring Private Equity Asia buying the multinational maker of cosmetic packaging for a reported $775 million from TPG Capital LP.
Hong Kong-based Baring Asia said it wanted to accelerate growth for HCP, which has six factories in China, Mexico and the United States. Last year, HCP said it made sizable investments in new capacity in China.
“The last three years have been a period of transformative growth for our business,” said HCP Group President and CEO Eddy Wu, in a statement on the company's website. “With TPG's world-class operational expertise and resources, we have become today one of the world's largest primary packaging company for color cosmetics and skincare products.
“Now, we are preparing to advance to the next phase of our development and take our business to the next level,” he said.
Baring Asia CEO Jean Eric Salata said HCP is “in an excellent position to enter into an accelerated growth phase in the coming years.”
San Francisco-based TPG bought HCP in 2012 from its founding Chen family, and the firm has expanded in recent years.
It said made “major capacity investments" in its China factories last year, boosting operations there to 300 injection presses, nine coinjection machines and 22 injection blow molding machines, along with increased capacity in spray coating and metallization.
It employs nearly 4,000 people at four manufacturing plants in China.
The companies did not disclose terms of the deal but Reuters news service reported that Baring paid $775 million for HCP. It cited sources familiar with the transaction and said it had seen a letter TPG wrote to its limited partners.
In a Jan. 11 news release, the companies said there would be no changes in HCP ongoing operations or management.
Wu, who joined HCP in 2012, had a background in executive positions in the plastics industry, serving as president and CEO of Momentive Performance Materials Asia Pacific and general manager of the former GE Plastics Noryl business.
Wu said HCP counts the 10 largest cosmetic companies worldwide among its customers. It specializes in designing and manufacturing primary packaging for the cosmetic, skincare and fragrance industries.
In 2014, the company said it was considering setting up manufacturing in Eastern Europe in 2015, but it's not clear if HCP proceeded with that plan.
At the time, Wu said in a statement on HCP's website that it was considering the European investment to be more responsive to customers, which is why it has manufacturing plants in Hinsdale, Ill., and Reynosa, Mexico, where it employs about 250 people in total.
“What matters most in this region, is our reactivity to customer requirements and the industrial proximity we offer the whole North American continent,” Wu said. “This is also what will drive us to establish ourselves industrially in Eastern Europe.”
At the time, the company said it expected 2014 sales of $240 million. HCP was founded in Taiwan in 1960.