Appvion, Inc. has sold its Encapsys microencapsulation division to an affiliate of Sherman Capital Holdings LLC, a private investment firm based in Baltimore. The purchase price was $208 million, as the company said in the press release received by Lesprom Network.
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.
Encapsys discovers, develops and manufactures microencapsulation solutions for use in the building and construction, paper, bedding, and personal and household care industries.
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, Wisconsin, and at a manufacturing plant in Portage, Wisconsin.
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.
Appvion produces thermal, carbonless, security, inkjet, digital specialty, and colored papers. Appvion, headquartered in Appleton, Wisconsin, has manufacturing operations in Wisconsin, Ohio and Pennsylvania.