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Nippon Paper acquiring Plus Paper Foodpac

MUMBAI, India (From news reports) -- Japan's Nippon Paper Industries Co. Ltd is entering the Indian market by acquiring the largest local paper cup manufacturing company owned by the BK Modi Group for an undisclosed amount.

Nippon Paper said it will acquire BK Modi Group's privately held firm Plus Paper Foodpac Pvt. Ltd, which counts Kentucky Fried Chicken and other leading multinational fast-food chains among its customers. The agreement was signed last month. Plus Paper operates two factories in India.

This will be a part of Nippon Paper's overseas expansion initiative for the paper container processing business following its recent move in Vietnam. In Vietnam, Nippon Paper has taken ownership of the manufacturing and marketing operations of local paper cup market leader Viet Hoa My Service Trading Production. The Japanese firm picked 65% stake in the JV with the Vietnamese firm and the venture began operating this month.

These acquisitions would give Nippon Paper its first manufacturing and marketing base in the subcontinent.

Nippon Paper expects demand for paper cups by Indian restaurants to grow along with an expanding middle class. India's fast-food market will rise by an estimated 50% from 2015 to $25.7 billion in 2020, according to British market survey company Euromonitor International.

As per its medium-term business plan (from FY2014-15 to FY2016-17), Nippon Paper has been going through a business restructuring, reallocating resources where future growth is anticipated, the firm said. In Asia, the paper and paperboard container market, particularly for food and beverages, is expected to see sound growth along with the expansion of personal consumption, it said.

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Join Jim Thompson on the 2nd Annual Papermakers Mission Trip to Guatemala, 22 - 29 July 17. Build houses, talk about the pulp and paper industry. For more information, email jthompson@taii.com with "Guatemala" in the subject line.


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