Mason Wells explores sale of Nelipak Healthcare Packaging

  • Mason Wells formed Nelipak via Sealed Air carveout in ’13
  • 1st round bids due this week
  • Produce expected to produce low double-digit multiple

Mason Wells is evaluating the sale of Nelipak Healthcare Packaging, a global provider of everything from thermoformed medical trays to pharmaceutical packaging, according to two people familiar with the situation.

The Midwestern-focused private equity firm has enlisted Lincoln International for financial advice on the sales process, the people said. First-round bids are due later this week, they said.

The process is expected to be broad, encompassing financial sponsors and strategic buyers, the people said.

Nelipak, Cranston, Rhode Island, produced 2018 Ebitda of about $35 million, one of the people said, while the other said the company is being marketed off adjusted Ebitda of about $40 million.

The process is likely to produce a low-double-digit Ebitda multiple, within the 10x to 13x range, they speculated.

Nelipak provides custom-designed thermoformed packaging products and services for the medical-device and pharmaceutical industries. Products include medical-device trays, procedure trays, pharmaceutical packaging, handling trays and sealing machines.

Its presence spans Europe, North America and Latin America.

Possible strategic buyers, one of the people suggested, could include the likes of Steris plc or Berwind Group’s Oliver Products.

The other person said that while Nelipak would be a great fit for Oliver Products, the company hasn’t been particularly active on the M&A front.

Genstar Capital-backed Tekni-Plex, pursuing an aggressive growth strategy in healthcare packing, represents another logical buyer, this person added.

Others that play in thermoformed packaging include Printpack and Thermoform Engineered Quality.

Mason Wells’s investment in Nelipak dates to December 2013.

The firm, investing out of its third fund, formed the company by carving out Sealed Air’s rigid medical packaging business. Sealed Air expected to receive $125 million through the sale, a statement said at the time.

While Nelipak has seen organic growth under Mason Wells’s backing, the question for stand-alone sponsors this time around, one of the people said, is whether the next several years present as much growth opportunity.

Nelipak has also grown through M&A under the firm’s backing, adding Phoenix’s Flexpak Corp, Puerto Rico’s Tegrant Alloyd Brands and, most recently, Whitehall, Pennsylvania’s Computer Designs.

Mason Wells, Milwaukee, seeks control positions in businesses generating $25 million to $300 million in revenue and Ebitda of $5 million to $30 million.

Mason Wells declined comment, while reps with Lincoln International and Nelipak couldn’t immediately be reached.

Action Item: Reach out to Greg Myers, Mason Wells senior managing director, at +1 414-727-6404