Century City-based private investment firm Atar Capital financed the acquisition of Conver Pack Inc., a manufacturer of paper cups, on behalf of its affiliate WinCup for an undisclosed amount.

The deal will help WinCup, an Atlanta-based maker of biodegradable straws and foam cups, gain ground in the paper cup category and expand into a bigger market, said Michael Winters, president and chief revenue officer at WinCup.

He estimated that the U.S. market for paper cups is $3 billion, compared to the $1 billion market for foam cups. Market researcher Spherical Insights estimated that the paper cup market was valued at $10.8 billion in 2022.

“We’ll be able to play in a much larger way with this acquisition,” Winters said.

The acquisition will give WinCup the opportunity to place its sustainable Phade technology in the line of sustainable cups manufactured by Conver Pack. The expansion can help influence foodservice companies to end the circulation of some plastics that are tossed in a landfill.

WinCup has been on a roll. Last month, Walmart began selling WinCup’s Phade products.

New deals underway

M&A activity for environmentally sustainable consumer goods deals increased in 2024, according to market researchers Global Data. In the second quarter of 2024, nine sustainable consumer goods deals composed a total value of $1.5 billion. In the prior quarter, deals for this category were just shy of $329 million.

While the Trump Administration has been scaling back government support for sustainability initiatives, Cyrus Nikou, Atar Capital’s founder and managing partner, said public and business support for sustainability is increasing.

“We believe sustainable business practices can create long-term value because it’s what consumers demand,” Nikou wrote in an email. “Consumer behavior has fundamentally shifted, and major restaurant chains, sports venues and Fortune 100 companies are choosing sustainable alternatives to meet customer expectations.”