Latvia-based PET Baltija, which describes itself as one of the largest polyethylene terephthalate (PET) recyclers in Northern Europe, has announced an agreement to acquire a Czech PET fiber producer Tesil Fibres s.r.o from its parent SILON s.r.o. - RecyclingToday

Once final, the transaction will increase PET Baltija’s current revenue by more than 50 percent while also making it an international company. That estimate comes from the Lithuania-based INVL Baltic Sea Growth Fund, which backed the acquisition.

INVL says SILON will “fully focus on both the production and development of the highest quality polyolefin-based performance compounds” after the sale.

INVL describes Tesil Fibres as a PET fiber supplier to the European market in the automotive, hygienic, textile and furniture sectors. “It is also well known for its high quality standards,” and last year its fiber division recorded sales of about $27 million, according to the fund. Tesil Fibres has production capacity of about 33,000 metric tons annually and has about 150 employees.

This deal will really put PET Baltija on a map as a key international player for the sector. We recognize and are excited by Tesil Fibres’ impressive high growth potential and its dedicated team of professionals. Working closely with the team and other key stakeholders, we plan to develop the company further, accelerating its growth and creating real value for all those involved. By ensuring the supply of best-in-class recycled PET materials, we will look to significantly contribute to the growth of the Tesil Fibres’ business and add greater product differentiation to it. It is also important to mention that through these developments, the overall volume of recycled PET will also increase.

Salvis Lapinš, board chair of PET Baltija

This agreement to acquire reinforces INVL Baltic Sea Growth Fund’s goal to significantly expand PET Baltija through both organic growth and bolt-on acquisition strategies. Since our initial investment, PET Baltija alone has more than doubled its revenue and is on track to finalize an organic growth expansion project that will more than triple its food-grade PET production capabilities. This deal will cement the company as a truly international vertically integrated market player that is committed to sustainability and tackling environmental issues. This represents a significant development and leads to become a $100-plus revenue company.

Deimante Korsakaite, an executive partner at INVL a member of the Supervisory Board at PET Baltija

PET Baltija is part of Eco Baltia, an environmental and waste management group in the Baltics that describes itself as providing waste collection and sorting services, secondary raw material logistics, and raw material processing. Its recycled product portfolio includes PET flakes and granules (including food packaging), of which it says nearly 100 percent is exported.

The INVL Baltic Sea Growth Fund is focused on the Baltic States (Estonia, Latvia and Lithuania) and the neighboring regions of Poland, Scandinavia and Central Europe.