Faerch Plast A/S, a Denmark-based supplier of sustainable rigid packaging for the food industry, is entering the U.S. market through the acquisition of an Israeli packaging producer, MCP Performance Plastic Ltd.
Faerch, part of Danish family-owned conglomerate A.P. Moller Holding, announced the deal July 19. Terms were not disclosed.
MCP has plants in Portage, Ind., and HaMa'Apil, Israel, that extrude and thermoform crystalline and amorphous PET and polypropylene sheet. The company employs 200 and makes a broad range of food trays.
Holstebro, Denmark-based Faerch employs more than 2,200 people based in 16 production sites in Denmark, Great Britain, France, Italy, Poland, Spain, the Czech Republic and the Netherlands. Faerch has integrated tray recycling operations, which it touted as a plus for MCP.
"Our circular solutions will complement MCP's product range, setting us jointly at the forefront of making food packaging circular also beyond Europe," Faerch CEO Lars Gade Hansen said in the release.
For Faerch, the acquisition marks the first since becoming part of the A.P. Moller Group earlier this year and is fully in line with its aim to increase the momentum in the food packaging industry for transitioning toward circularity and scaling its recycling business into additional countries.
Faerch offers tray-to-tray recycling on an industrial scale, taking back used PET food packaging and recycling the material into new food-grade containers, tubs and trays of the same quality.
The acquisition also represents the first time Faerch has looked to expand its geographical presence outside Europe. In particular, the transaction opens the door for Faerch to the U.S. market.
"MCP will serve as a stepping stone for Faerch entering the important U.S. market, which is estimated to account for $55 billion. Being local will allow us to support the retailers, brand owners and food manufacturers in making the right material choice for true circularity in the U.S. food packaging market," Hansen said.
The transaction is expected to close within three months.