Novolex acquired by New York-based fund

Novolex acquired by New York-based fund

Apollo Global Management Inc. buys majority stake in packaging firm that consumes plastic scrap.

February 17, 2022

The Apollo Funds affiliate of New York-based Apollo Global Management Inc. has acquired a majority stake in South Carolina-based packaging producer Novolex. Novolex describes itself as a maker of packaging products made with fiber, renewable, recycled and bio-based materials and resin that are designed to be recycled and composted.

Saying it serves customers in the food service, delivery and carryout, food processor and industrial markets, Novolex says it provides those customers with “packaging innovation, choice and sustainability.”

The announced transaction is described by Apollo as a definitive agreement for Apollo Funds to acquire the majority of Novolex from Carlyle—a Washington-based fund that acquired its stake in Novolex in 2016. Carlyle will retain a minority stake in Novolex, say the two funds.

Novolex brands include Hilex, Duro, Bagcraft, De Luxe, Polar Pak, Shields, Waddington, Burrows, Eco-Products and Heritage Bag. Globally, the company has more than 10,000 employees and operates 57 manufacturing plants in North America and Europe, including two plastic recycling facilities.

Rob Seminara, a partner at Apollo, says, “We are pleased to invest in Novolex, a high-quality, resilient business with a loyal, long-term customer base. The company has a strong management team and is poised to capitalize on growth across food delivery and e-commerce as well as increasing demand for environmentally responsible and compostable products. Importantly, Novolex shares our commitment to sustainability. We look forward to working alongside Stan Bikulege and the rest of the talented management team to create significant value for customers and our investors.”

Bikulege, Novolex chair and CEO,  adds “This transaction is a milestone in the Novolex growth story and for the 10,000 families who contribute to our company every day. Apollo offers tremendous resources and expertise and brings significant experience in the packaging industry to the table that will enable us to continue to thrive on the next leg of our journey.”

The transaction is expected to close during the second quarter of 2022. Financial institutions taking part in the transaction include Deutsche Bank, Evercore, Barclays, Goldman Sachs Group Inc. and Credit Suisse Group. Acting as legal counsel for one party or the other were Paul, Weiss, Rifkind, Wharton & Garrison, Latham & Watkins LLP and Nelson Mullins Riley & Scarborough LLP.

Apollo says it has nearly $500 billion of assets under management. Late last year, its portfolio company Showa Aluminum Can Corp., based in Japan, agreed to acquire the aluminum rolled and extruded products operations of Mitsubishi Aluminum Co. Ltd. That firm collects and melts some 4.4 million used beverage cans (UBCs) each year, which it says involves about 67.8 tons of aluminum.