Ivex Packaging Completes Formation of Packaging Dynamics LLC

Ivex Packaging Corp., Lincolnshire, IL, has completed the formation of a non-consolidated joint venture, Packaging Dynamics, LLC, whereby Packaging Dynamics has acquired the assets of Bagcraft Corp. of America, an indirect, wholly owned subsidiary of Artra Group Inc., and obtained certain non-compete covenants from Artra for $89 million in cash. In addition, Packaging Dynamics has acquired the assets of Ivex's paper mill in Detroit for cash, subordinated promissory notes and a 49% equity interest in the venture aggregating $28.5 million. The remaining 51% of Packaging Dynamics is owned by certain financial investors, including certain members of management of Ivex and Bagcraft.

With vertical integration, Packaging Dynamics will produce specialty bags and wraps for the food-service, supermarket, bakery and retail industries. Additionally, Packaging Dynamic's Detroit mill will continue to supply products to the paper converting markets. Packaging Dynamics will capitalize on the shared resources of the two organizations to improve product development opportunities and further penetrate the flexible food packaging market.

Ivex is a vertically integrated specialty packaging company that designs and manufactures value-added plastic- and paper-based flexible packaging products for consumer and industrial packaging markets. Bagcraft produces sandwich wraps, window bags, microwave popcorn bags and waxed bags with manufacturing facilities in Chicago and Baxter Springs, KS.