Appvion Sells Encapsys Division

 
Appvion Inc., Appleton, Wis., USA, this week announced that it has sold the company’s Encapsys microencapsulation division to an affiliate of Sherman Capital Holdings LLC, a private investment firm based in Baltimore, Md. The purchase price was $208 million.

Conditions of the sale include a long-term supply agreement whereby Encapsys will continue to produce and sell microcapsules to Appvion that Appvion uses to produce its carbonless paper. Mary Goggans, VP and GM of the Encapsys division under Appvion ownership, has been named president of the now independent Encapsys LLC.

Appvion formed the division nearly 10 years ago to leverage the company's 50 years of experience, technical expertise, and large-scale production capabilities for microencapsulation that it developed through its production of carbonless paper. Net sales for Encapsys topped $61 million in 2014. The business employs approximately 90 people at offices and research labs in Appleton and at a manufacturing plant in Portage, Wis. Terms of the sale allow Encapsys to lease office and lab space at Appvion facilities in Appleton while a search for other facilities is conducted.

Mark Richards, Appvion's chairman, president and CEO, said the success and growth potential of the Encapsys business earned an attractive purchase price. Appvion chose to extract the value of Encapsys now as a way to significantly reduce company debt and gain financial flexibility to invest in its technical papers and coatings business.

"With an improved balance sheet, we will gain financial strength and flexibility to focus on our paper and coatings business and to pursue opportunities to expand our business and product portfolio," Richards said.
 
Richards added that "I am proud of what we have achieved in creating Encapsys. Our employees embraced an entrepreneurial spirit and a collaborative approach to working with customers to build a growing business. That knowledge and approach, coupled with the strategy and resources of Sherman Capital Holdings, represent a powerful combination for Encapsys employees and customers."

TAPPI
http://www.tappi.org/