Mexico City, Mexico and Norcross, Georgia, USA 28 March 2016 -- (GLOBE NEWSWIRE) -- Grupo Gondi and WestRock (NYSE:WRK) have been authorized by COFECE to implement the agreement which will allow them to combine their operations in Mexico to form a strategic alliance, creating the leading packaging company in the country. The parties expect to close the transaction in early April.
After the closing, Grupo Gondi will have 13 plants including three WestRock corrugated packaging facilities in Mexico.
WestRock, is a leader in the paper and packaging industry, and will contribute three plants located in Mexicali, Monterrey and Queretaro, and a cash contribution in exchange for a 25% equity participation in Grupo Gondi.
As the majority shareholder in this joint venture, Gondi's management team, led by Eduardo Posada, will be responsible for the management of the joint venture. WestRock will offer technical and commercial support, and will work with Gondi to support multinational customers located in Mexico. With this integration Gondi Group will employ approximately 6,800 people.
"With this authorization Gondi expands its presence in the Mexican market by offering better alternatives to our customers with advanced technology and an expanded portfolio of solutions for paper packaging. We have a proven ability to provide our customers with an excellent service level and innovation. Through this partnership, we will continue our growth and expand our national presence," said Eduardo Posada, chief executive officer of Grupo Gondi.
"Grupo Gondi offers packaging solutions through a balance of robust and structural design and high graphics, combined with constant innovation that helps to highlight the brands of our customers. In Mexico, we are the packaging company that goes beyond a traditional box to a packaging solution that helps sell the product it contains," continued Posada.
"We are pleased to join our WestRock paperboard packaging operations in Mexico with Grupo Gondi," said Steve Voorhees, chief executive officer of WestRock. "With this new joint venture, WestRock will accelerate the expansion of our business in this region with a partner that shares our commitment to providing innovative, high-quality packaging solutions for our customers."
"With this step Grupo Gondi reaches one of its main goals in establishing this strategic alliance with WestRock and continues to strengthen its value as the best choice of packaging in Mexico. Every day we are more confident and optimistic about the opportunities to grow this business together," said Alejandro González Cimadevilla, Grupo Gondi's chairman of the board.
Forward-looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as "may," "will," "could," "should," "would," "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "target," "prospects," "potential" and "forecast," and other words, terms and phrases of similar meaning. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. WestRock cautions readers that a forward-looking statement is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statement. Such forward-looking statements include, but are not limited to, statements regarding, among other things, our expectation that the partnership will enable Grupo Gondi to continue to grow and expand its national presence; our belief that the joint venture will accelerate the expansion of our business in the region; and our expectation that the joint venture will be consummated in early April. With respect to these statements, WestRock and Grupo Gondi have made assumptions regarding, among other things, the results and impact of the joint venture; economic, competitive and market conditions in Mexico generally; volumes and price levels of purchases by customers; competitive conditions in the joint venture's businesses and possible adverse actions of their customers, competitors and suppliers. Further, WestRock's and Grupo Gondi's businesses are subject to a number of general risks that would affect any such forward-looking statements including, among others, decreases in demand for their products; increases in energy, raw materials, shipping and capital equipment costs; reduced supply of raw materials; fluctuations in selling prices and volumes; intense competition; the potential loss of certain customers; the scope, costs, timing and impact of any restructuring of our operations and corporate and tax structure; the occurrence of a natural disaster, such as a hurricane, tropical storm, earthquake, tornado, flood, fire, or other unanticipated problems such as labor difficulties, equipment failure or unscheduled maintenance and repair, which could result in operational disruptions of varied duration; and adverse changes in general market and industry conditions. The information contained herein speaks as of the date hereof and WestRock does not have or undertake any obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.
About Gondi
Gondi is the main leader in the paper and packaging industry in the Mexican market. With this integration, the company has 13 plants in the country and offers innovative paper packaging solutions to more than 650 customers.
Learn more about Gondi in www.grupogondi.com
About WestRock
WestRock Company (NYSE:WRK) aspires to be the premier partner and unrivaled provider of paper and packaging solutions in consumer and corrugated markets. WestRock's 41,000 team members support customers around the world from approximately 250 operating and business locations spanning North America, South America, Europe and Asia. Learn more at www.westrock.com.
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