MILAN- Italian bioplastics group Novamont said on Tuesday it had bought Norway's BioBag Group to grow its bioplastics business in Europe, North America and Australia.
No financial details were given but a source close to the matter said the deal was worth around 30 million euros ($37 million).
BioBag, which is already a client of Novamont, will continue to operate as an independent company, Novamont Managing Director Marco Fumagalli said.
Fumagalli said the acquisition of BioBag, which buys bioplastics to transform them into bags for waste collection or compostable packaging, was aimed at speeding up his group's growth internationally.
"Organic growth remains the main driver, though we don't exclude more bolt-on acquisitions if it allows us to take advantage of opportunities," Fumagalli said.
According to Fortune Business Insights, the bioplastics industry is estimated to be worth $20 billion in 2026 when it will make up around 3.1% of the total plastics market compared to 1.4% in 2018.
The production of bioplastics is still growing at a much slower rate than petrochemicals as the industry struggles to build scale. But carbon emission taxation and single-use, fossil-based plastic bans may help change that.
Novamont, one of the world's leading bioplastics companies, booked revenue of 270 million euros in 2019. Fumagalli said it expected double-digit sales growth in 2021 and to double by 2025.
He also said an initial public offering on the stock market was among the options further down the road.
"It's definitely among our plans for the next few years," he said.
Novamont is currently 75% controlled by private equity funds Investitori Associati and Neuberger Berman. Italian energy group Eni owns 25%.
($1 = 0.8228 euros)
(Reporting by Stephen Jewkes; editing by David Evans) ((stephen.jewkes@thomsonreuters.com; +39.0266129695; Reuters Messaging: stephen.jewkes.thomsonreuters.com@reuters.net))
