Wolverhampton packaging business bought for £7.5m
A packaging distributor has been bought in a £7.5 million deal by a bigger industry rival.
Network Packaging, launched in Wolverhampton in 1997, won the small business of the year category in the Express & Star Business Awards in 2012 and last year expanded with a new £15,000 sq ft warehouse at its Ettingshall base, while it recruited another six staff. Last year it made £800,000 profit on turnover of £7.8 million.
It is being taken over by Macfarlane while last year made £5.1m on £143.9m turnover in the same year.
It employs around 700 people.
Macfarlane says Network Packaging's management team have agreed to stay on after the takeover. The company will retain its existing name and identity.
Macfarlane chief executive Peter Atkinson said: "Network Packaging is a successful company and today's acquisition demonstrates our continuing commitment to the strategy of developing our UK Packaging Distribution business.
"We are delighted that the Network Packaging management team will remain with the business. They will add to our management capability and their experience in the third-party logistics sector and internet retail will complement the existing Macfarlane strengths in these market sectors."
Network Packaging, which is based on the Spring Road Industrial Estate in Lanesfield Drive, added new people last year for the warehouse and in sales, marketing and purchasing to meet growing customer demand.
The company now employs 27 and Mr Atkinson said that the new owners wanted to retain the whole workforce.
"Its success is very much down to the people in the business and we ant to retain all or as many as we can.
"There is the potential for more emplopyment as we plan to continue to grow the business," he explained.
Mr Atkinson said a high level of support was being shown for Glasgow-based Macfarlane's growth strategy by both new and existing institutional shareholders.
"The successful acquisition of Lane Packaging earlier this year demonstrates our ability to identify, complete and integrate acquisitions effectively," he added.
The Birmingham office of law firm Browne Jacobsen acted for Network Packaging and spokesman Roger Birchall said:
"This is a good deal for all parties. The acquisition is an important strategic step for Macfarlane Group as it seeks to strengthen its footprint in the Midlands.
"We are delighted to have assisted the shareholders of Network Packaging in realising 17 years' hard work and dedication; in particular we are pleased that their invaluable management experience and expertise will continue to be utilised within the business post completion."
Macfarlane is one of the leading specialist UK distributors of protective packaging materials.
It has 17 regional distribution centres supplying customers on a local, regional and national basis.
Between 2006 and 2008 Macfarlane acquired three regional protective packaging specialists and successfully integrated them into its UK network.
PSD Industrial Holdings, the parent company of Lane Packaging, a specialist packaging distributor based in Reading was bought in May.
The Network Packaging' business plan is to improve turnover and operating profits by more than 40 per cent over the next two years.
