KPS Capital Partners has signed a definitive agreement to acquire MM Packaging from Austrian group Mayr-Melnhof Karton (MM Group) in a transaction valuing the business at an enterprise value of €2.4 billion. MM Group will retain a 30% ownership interest, while MM Packaging will operate as a standalone company following completion.
Transaction details
The transaction covers MM Group's Food & Premium Packaging operations, excluding its activities in Iran and Tunisia, as well as its Pharma & Healthcare Packaging operations.
MM Packaging manufactures fiber-based consumer packaging products, including folding cartons, labels and leaflets for the food and beverage, pharmaceutical, healthcare, beauty, personal care and household care markets.
Headquartered in Vienna, Austria, MM Packaging operates more than 50 production sites across 19 countries and employs approximately 8,500 people. The company is the world's largest producer of secondary pharmaceutical packaging and a major European supplier of folding cartons for food applications.
Under the agreement, KPS will hold a 70% stake in a newly established holding company that will acquire the packaging business, with MM Group retaining the remaining 30%. The transaction values the business at approximately nine times its estimated adjusted EBITDA for 2026.
MM Group expects to receive approximately €1.8 billion to €1.9 billion in cash proceeds upon completion, net of its estimated €400 million investment for the retained minority interest. Its stake could, however, be reduced to a minimum of 20% if certain EBITDA targets for 2027 are not achieved.
A standalone packaging business
The transaction will separate MM Group's Packaging and Board & Paper activities, allowing each business to pursue its own strategy and capital allocation priorities.
MM Packaging is expected to focus on organic growth and selective acquisitions under KPS ownership, supported by the private equity firm's experience in industrial businesses and operational improvement.
Following completion, MM Group will concentrate on its Board & Paper operations while continuing its involvement in the packaging business as a minority shareholder. A long-term cartonboard supply agreement will also secure supplies from MM Group's Board & Paper business to MM Packaging.
Peter Oswald, CEO of MM Group, said: "This transaction will allow MM Packaging to accelerate growth under the leadership of KPS, a leading private equity investor in manufacturing and industrial companies. Our retained shareholding of 30% will enable MM Group to participate in its future value creation. As the European leader in folding cartonboard, our Board & Paper business will become an independent supplier to the packaging industry.
Following the transaction, MM Group will have a strong balance sheet and the financial resources to develop its business organically and through selected acquisitions and partnerships. At the same time, we plan a substantial distribution of capital to our shareholders."
MM Group's financial position
For MM Group, the proceeds will strengthen its financial position and provide additional flexibility to pursue strategic opportunities. The company expects to have net cash of approximately €800 million to €900 million following completion. It intends to use the proceeds to repay debt, fund strategic opportunities and distribute capital to shareholders.
Subject to the necessary approvals and other conditions, MM Group is planning a special distribution of €500 million to €600 million following completion.
Michael Psaros, Co-Founder and Co-Managing Partner of KPS, said: "MM Packaging is an industry-leading business, and we are excited to take it to the next level as an independent company. We appreciate the trust MM Group is placing in KPS and look forward to our partnership. KPS has had extraordinary success investing in the packaging sector across paper, board and metal substrates. We will leverage our deep industry experience, financial resources, commitment to manufacturing excellence and global presence to drive MM Packaging's growth."
KPS's investment strategy
KPS manages investment funds with approximately US$19.1 billion in assets under management as of June 30, 2026. Its investments span manufacturing and industrial sectors, including basic materials, capital equipment, automotive components and packaging.
Operations at both MM Packaging and Board & Paper will continue as normal following the signing of the agreement. MM Packaging will retain its name after becoming a standalone company.
Completion is subject to the required corporate and regulatory approvals and other customary closing conditions. The French operations are also subject to consultation processes with employee representatives. The transaction is expected to close in the first half of 2027.
