Private equity firm Wind Point Partners is exploring a sale of Novolex, in a deal that could value the U.S. manufacturer of paper and plastic packaging products at around $1.75 billion, including debt, according to three people familiar with the matter.
Wind Point Partners has hired investment banks Deutsche Bank AG (DBKGn.DE) and Macquarie Group Ltd (MQG.AX) to run an auction for Novolex, the people said this week, asking not to be identified because the sale process is confidential.
Novolex and Wind Point Partners did not respond to requests for comment, while Deutsche Bank and Macquarie declined to comment.
Novolex, based in Hartsville, South Carolina, owns several North American packaging brands that make everything from paper bags and plastic grocery bags to coffee sleeves and can liners. It has 5,000 employees in the United States, Canada and Mexico.
Wind Point Partners acquired Novolex, which was formerly known as Hilex Poly, in 2012 from TPG Growth for an undisclosed sum. Last year, Novolex bought Chicago-based food packaging producer Packaging Dynamics Corp from buyout firm Kohlberg & Co for $570 million.
Novolex is not the only private equity-owned packaging company for sale. Reuters reported in March that private equity firm Olympus Partners was exploring a sale of disposal silverware maker Waddington Group worth more than $1.5 billion.
Deals in the packaging industry have been on the upswing and hit $29.9 billion last year, up from $21.7 billion in 2013, according to adviser Mesirow Financial.
(Reporting by Greg Roumeliotis in New York; Editing by Bernard Orr)
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