Toppan Leefung Accor acquires Jiucheng Packaging for 330 million – What is the intention behind this major move?
Recently, the global printing giant Toppan Holdings Inc. of Japan (hereinafter referred to as Toppan) completed the acquisition of 100% equity of Shanghai Jiucheng Packaging Co., Ltd. (hereinafter referred to as Jiucheng Packaging) through its Hong Kong subsidiary, Toppan Li Fung Yage Co., Ltd., for a total price of 330 million yuan. In this transaction, the listed company Shanghai Haishun New Pharmaceutical Packaging Materials Co., Ltd. transferred its 43.015% stake in Jiucheng Packaging, recovering approximately 142 million yuan in funds.
Jiucheng Packaging, established in 2007, is a mature enterprise that has been deeply involved in the field of composite flexible packaging for many years. It mainly serves the consumer goods industry, such as daily chemicals and beauty products, with clients including well-known brands like Olay, One Leaf, OSM, Proya, Kans, and Inoherb.
Financial data shows that in 2024, Jiucheng Packaging achieved a revenue of 268 million yuan and a net profit of 18.5419 million yuan, with a net profit margin of 6.93%. In the first three quarters of 2025, it achieved a revenue of 217 million yuan and a net profit of 36.188 million yuan, with a net profit margin reaching 16.69%, demonstrating strong profitability.
If you look at the transaction itself, this is an unassuming equity transaction, but in the overall context of Toppan Company's layout in the Chinese market in recent years, the signal released by this acquisition is not simple.
From "continuous shrinkage" to "precise increase"
Over the past decade, Toppan has continued to adjust its business structure in the Chinese market, the most intuitive of which is the closure and withdrawal of many printing companies. In 2022, Shanghai Li & Fung Accor Printing Co., Ltd. announced the cessation of production; In 2016, Li & Fung Accor Printing (Shenzhen) Co., Ltd. also announced the closure of the factory. Earlier, Toppan closed down a number of subsidiaries that mainly focused on traditional paper printing, such as Toppan Printing (Shanghai) Co., Ltd., Toppan Printing (Shenzhen) Co., Ltd., and Beijing Ribang Printing Co., Ltd.
This also shows that Toppan has been doing subtraction for a long time and continuously. However, "doing subtraction" does not mean a total retreat.
At present, Toppan still retains and operates some printing and packaging-related businesses in China, such as Shanghai Toppan Co., Ltd., Toppan Jiuzheng Packaging Materials (Shanghai) Co., Ltd., etc., and the acquired Jiucheng Packaging is the same as Shanghai Toppan and Toppan Jiuzheng, all of which take flexible packaging products as their core business direction.
From paper printing "subtraction" to flexible packaging "addition", this turn reflects that Toppan is not fully shrinking in the Chinese market, but has maintained an enterprising trend in the field of flexible packaging.
Why Jiucheng?
In this strategic context, the entry of Jiucheng Packaging is more like a "precise increase" after careful screening.
First, there is a significant improvement in profitability. As mentioned in the previous analysis, in the case of little change in revenue scale in 2024 and 2025, Jiucheng Packaging's net profit level and net profit margin have increased significantly, reflecting the enhancement of its profit quality and profit conversion ability.
Secondly, it is a relatively stable customer structure. Jiucheng Packaging has long served brand customers such as daily chemicals, pets, and beauty. Such customers have high requirements for packaging quality, delivery stability, and compliance capabilities, and the partnership is usually sticky. Compared with order structures that rely heavily on price competition, such a customer base is more in line with the preference of foreign-funded enterprises for long-term cooperation.
Third, it is a product structure with room for upgrading. Jiucheng Packaging has accumulated a solid foundation in the field of composite flexible packaging, while Toppan has a mature technology system in high-barrier materials, functional films and pharmaceutical packaging. The two sides have the possibility of synergy in terms of materials, technology and applications, which also means that the logic of mergers and acquisitions is not simply to expand production capacity, but to reserve space for subsequent product upgrades.
What does Toppan's choice mean for Chinese Indian companies?
1. Think clearly about whether you want to "stay on this track"
Toppan Company's choice shows that foreign capital is not a comprehensive contraction, but is actively avoiding business areas with low gross profit and strong involution, and concentrating resources on more deterministic segments. For domestic printing and packaging enterprises, the first answer is not "how to do it", but "whether to continue to do it".
It is necessary for enterprises to examine the long-term value of the track they are in based on their own conditions: whether this track is still worth continuous investment in the next three to five years, and whether it has a realistic foundation for continued cultivation. Thinking clearly about "whether to continue to do it" is often more important than rushing to discuss "how to do it".
2. Instead of blindly expanding the scale, it is better to "stabilize" the customer structure first
Jiucheng Packaging is not the largest enterprise in the industry, but because it serves brand customers for a long time, its business performance is more stable and its anti-risk ability is stronger. This is particularly noteworthy in the current market environment.
For many printing and packaging companies, the development method of "more equipment, more orders, and cost sharing by scale" in the past has become more and more difficult to implement. Relying solely on low-priced orders and price competition not only continuously compresses profit margins, but also easily bears the brunt of market fluctuations.
In contrast, companies need to spend more energy looking at who they are "making products for": Are customers too price-sensitive? Is there a chance to enter the stable supply system of brand customers? In terms of delivery and quality, whether the basic ability has been formed to make customers willing to cooperate for a long time. It is often more practical to spend some resources on stabilizing and upgrading the customer structure than blindly expanding the scale.
3. Leave room for "technology upgrades" in advance, rather than waiting for passive elimination
Toppan acquired Jiucheng Packaging not only because of its existing production capacity, but more importantly, because Jiucheng Packaging has a foundation for further upgrading in the field of flexible packaging. This also reflects that in the current industry environment, the focus of industrial capital is shifting from "how much production capacity" to "whether it can be upgraded".
For Chinese printing and packaging enterprises, this means that they need to review their technical carrying capacity in advance: whether they have the basic conditions to undertake new materials and new processes, whether the equipment, personnel and management system support the continuous upgrading of product structure, and whether the enterprise is willing to reserve investment space for future capacity improvement. Even if you do not have the conditions for comprehensive transformation for the time being, you should avoid locking yourself in a path with low added value and difficult to upgrade. In other words, printing and packaging companies may not need to go to the high-end immediately, but at least they must "catch the high-end"; It may not be transformed immediately, but it cannot be dead. This "upgradeability" is becoming an important factor in whether enterprises can gain long-term capital favor in the process of industry differentiation.
From traditional paper printing to flexible packaging, Toppan Company's choice in the Chinese market is not a simple merger and acquisition, but a long-term adjustment around the business structure. By continuing to "do subtraction", we will withdraw from traditional fields with uncertain returns and intensified competition; Through precise "addition", the strategic orientation of the subdivision track with more stable demand and higher technical threshold has been very clear.
For China's printing and packaging industry, what is really worth paying attention to is not only the 330 million yuan deal itself, but the judgment logic adhered to by multinational printing giants between trade-offs - which tracks are worth long-term investment and which models are gradually losing their attractiveness. When the industry enters the stage of deep differentiation, it is often more important to see the direction and find the right position than to chase scale. The acquisition of Toppan Company is not only a strategic implementation at the enterprise level, but also provides thinking and reference for the transformation and development of China's printing and packaging enterprises.