Label and packaging solutions provider CCL Industries has agreed to acquire Treofan Americas and Trespaphan Mexico Holdings from their parent company M&C SpA for $255 million.

The deal includes the Treofan Americas business in Canada, where CCL is headquartered, the US and Latin America. Italy’s M&C will continue to control the equivalent European business through Treofan Germany and Treofan Italy. As M&C will retain the rights to the Treofan name, CCL will rename the acquired businesses under the Innovia brand.

Treofan Americas produces BOPP film in Zacapu, Mexico, and has capacity for 60,000 tonnes in the consumer packaging and label markets. The company will install a 10m-wide BOPP extrusion line later this year, which will add 30,000 tonnes of capacity. This will require a significant increase at the Mexican facility.

Approximately 65 per cent of sales are in the US with the balance predominantly in Latin America. Sales in FY17 at Treofan Americas were $212 million with EBITDA of $40m.

The total capital expenditure on the project is estimated at $65m as CCL has agreed to reimburse M&C for all cash capital expenses incurred at closing, which is in addition to the purchase price.

Geoffrey Martin, chief executive of CCL, said: “The proposed acquisition gives Innovia a solid strategic footprint for BOPP films in both North America and Europe with complementary technologies and products. The business will be combined with Innovia in the Americas under a common brand and the leadership of Guenther Birkner who heads our label interests globally in the Food & Beverage and Healthcare & Specialty markets, as well as this important new strategic initiative in the materials science arena.”