The board of directors of JK Paper Ltd, one of India's largest paper and packaging solutions companies, in its meeting held on December 13 approved a composite scheme of arrangement in which three wholly-owned subsidiaries of the company will be merged into JK Paper to consolidate and streamline the company’s structure.
The three subsidiaries that will be merged into JK Paper include Horizon Packs Private Limited, Securipax Packaging Private Limited and JKPL Utility Packaging Solutions.
Under the scheme, another group company - The Sirpur Paper Mills limited - will become a direct subsidiary of JKPL.
“The composite scheme of arrangement approved by the board would result in the consolidation of paper and packaging businesses and streamline the corporate structure bringing in efficiencies in operations processes and ease of compliances. This will also help us serve our customers better,” said Harsh Pati Singhania, Chairman and Managing Director, JK Paper.
The scheme is subject to the receipt of requisite approvals from the stock exchanges, Securities and Exchange Board of India, the National Company Law Tribunal and other statutory and regulatory authorities under applicable laws, respective companies shareholders and creditors. The transaction is expected to be completed in twelve months，subject to regulatory approvals.
JK Paper was advised by JM Financial and Katalyst Advisors.
Separately, JK Paper’s board also approved the acquisition of a majority stake in Radhesham Wellpack Pvt Ltd (RWPL). RWPL is engaged in the business of manufacturing corrugated boxes, corrugated sheets and other corrugated packaging related products. Corrugated packaging is a rapidly growing segment in the Indian paper and packaging industry driven by growth in end use industries.
“The acquisition of RWPL is in line with the long term strategic objective of the company in the packaging business and gives us an opportunity to have a greater footprint in the western region,” said Singahnia.
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