Global PET producer Indorama Ventures paid nearly $25 million for California PET reclaimer Green Fiber International, new financial disclosures show.
Indorama bought Green Fiber from LQ Inc. for $24.6 million on Dec. 3, 2019, according to Indorama’s 2019 financial report. With the purchase, Indorama acquired over $1.1 million in Green Fiber’s cash, so Indorama’s total cash outflow was closer to $23.5 million.
Green Fiber has a 140,000-square-foot plant in Fontana, Calif., which is east of Los Angeles, that is capable of producing up to 88 million pounds per year of RPET flakes for food-contact packaging. Indorama said the acquisition extends the company’s recycled flake supply chain to the West Coast, allowing it support its beverage brand customers in their circular economy efforts.
The deal was the second U.S. PET reclaimer acquisition in 2019 for Indorama Ventures (IVL), which is the world’s largest PET producer.
In January 2019, IVL paid $30 million to acquire Custom Polymers PET’s recycling plant, which became IVL’s first bale-to-flake operation. The Athens, Ala. facility can produce over 68 million pounds of RPET flake and food-grade pellets each year.
IVL, which is headquartered in Bangkok, released additional financial details about the Green Fiber International acquisition: At the time of purchase, the reclaimer had net assets that were valued at about $17.2 million. The majority of that was property, plant and equipment (estimated value of $9.9 million). After that was trade receivables ($4.0 million) and intangible assets such as customer contracts and relationships ($1.6 million).
Goodwill, which generally takes into account factors such as the business’s brand name and reputation and its relations with customers and employees, was valued at $7.4 million.
