Three private equity firms line up bids to take over IPL Plastics

Potential deal could offer long-awaited exit for around 2,000 Irish investors

THREE private equity firms have made bids for Irish-Canadian company IPL Plastics, the Sunday Independent has learnt. Any take-private would offer an exit to Irish shareholders of the company, including businessman Larry Goodman, several Irish coops and around 2,000 small private investors.

It is understood that Bank of Montreal is acting for IPL Plastics, which was formerly known as One51 and based on Thomas Street, Dublin. It listed on the Toronto Stock Exchange in 2018 but its share price has struggled since then.

It is understood that

CapVest, which is led by Cavan man Seamus Fitzpatrick, is one of the three interested parties. CapVest made previous attempts to take over the company when it was One51.

A second bidder is Madison Dearborn, which is known in Ireland for acquiring Jefferson Smurfit Group in 2002. The third party is understood to be US private equity giant Apollo.

Both Madison Dearborn and Apollo have previously invested in companies in the plastics sector.

Approaches first took place late last year.

While market sources said that a deal was unlikely to proceed at present due to the uncertainty created by the coronavirus, it is understood that some involved in the process are still hopeful that a deal could go ahead.

Price has been key to the discussions and sources said that any deal would have to ensure that there was an acceptable return to shareholders. A number of Canadian institutions invested in the company at the time of listing.

The key shareholders are Canadian firms, public pension fund manager Caisse de depot et placement du Quebec (CDPQ) and Fonds de Solidarite.

The Irish shareholders hold a 45pc stake in the firm.

Shares in the company listed at CA$13.50 (€8.85) on the Toronto Stock Exchange less than two years ago.

The listing price meant that old One51 shares were valued at around €1.77. At the current share price of CA$3.85, old One51 shares are valued at 56c each. A significant premium would be required to get a take-private over the line.

It was announced last week that Pat Dalton, the CFO of the company, was “resigning from the board of directors, effective immediately to pursue other business opportunities”. He had been in the role for eight years.

It is understood that the CFO position will no longer be represented at board level in IPL, which is not unusual in Canadian firms.