KPS to Buy MM Packaging for 2.4 Billion Euros in Carton Shake-Up

KPS Capital Partners has agreed to acquire folding carton maker MM Packaging at an enterprise value of 2.4 billion euros — roughly $2.68 billion — in the packaging industry's latest private equity pivot.

The buyer announced the deal Monday. KPS is picking up the business from Austrian fiber packaging manufacturer Mayr-Melnhof Karton AG, known as MM Group, which will keep a 30% stake. That stake could shrink to 20% if certain earnings targets aren't met next year. MM Group said the packaging arm "already operates largely independently," and MM Packaging will become a standalone company at closing.

What does the buyer actually get?

A lot of plants. MM Group spans 50 sites across 19 countries, with six U.S. facilities listed: one in Indianapolis, three in North Carolina and two in Puerto Rico. The operation makes folding cartons, labels, leaflets and printed aluminum foil for food and beverage, beauty and personal care, and household care end markets.

There's also a pharma angle, and it's the interesting one. MM describes itself as "the world's largest producer of secondary pharmaceutical packaging" — a market accelerating on the back of GLP-1 drug growth. Weight-loss drugs, it turns out, need boxes.

Michael Psaros, co-founder and co-managing partner of KPS, framed the deal as a growth play. "MM Packaging is an industry-leading business, and we are excited to take it to the next level as an independent company," Psaros said in a statement. "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."

Why is MM Group selling?

Because the rest of the business needs the money and the attention. MM Group will refocus on its struggling board and paper business, which a recent quarterly earnings report said has been pressured this year by "persistent market overcapacity" and "sharply rising energy costs."

The two businesses won't fully part ways. MM Group said a long-term agreement will have its board and paper operations supplying cartonboard to MM Packaging — demand that could steady the legacy unit.

The transaction should hand MM Group net cash of 800 million to 900 million euros at closing. The money is already spoken for: debt repayment plus a special shareholder distribution of 500 million to 600 million euros.

KPS knows this territory

New York-based KPS has run this playbook before. It held Eviosys, created through a 2021 carve-out from Crown Holdings, and sold it to Sonoco for $3.8 billion in 2024. Earlier, it invested in Anchor Glass in 2014 and exited in 2016, selling to CVC Capital Partners and European glass bottle maker BA Glass for more than $1 billion.

That's roughly a billion-plus return, twice, in a decade. Packaging, evidently, pays.

A busy year for carve-outs

The MM deal is the latest spinoff-and-PE pairing in packaging this year. Last month, Silgan announced a complex transaction with New York-based American Industrial Partners that moves Silgan's metal containers segment and its food and beverage flat-cap closures businesses into a combination with newly acquired European metal packaging specialist Trivium Packaging. Silgan takes 60% of the new company; AIP takes 40%.

For brand owners and retail buyers, the practical question is whether an independent, PE-backed MM Packaging invests faster in capacity and pharma-focused carton formats. GLP-1 demand won't wait, and neither, presumably, will KPS.