The building blocks of buy and build

At its heart, private equity is about value creation. Returns are earned by actively shaping businesses so that they become stronger, more competitive, and more resilient than when first acquired. That value can take many forms: 

• Operational value: streamlining processes, professionalising management, modernising systems. 

• Strategic value: repositioning a company, expanding into new geographies or product lines, building defensible market share. 

• Financial value: optimising capital structures, improving cash flow, and ultimately realising higher multiples at exit. 

• Human capital value: investing in leadership teams and aligning incentives so that managers and owners pull in the same direction. Whether it’s through operational improvements, strategic repositioning, digital transformation, or cultural renewal, the common thread is this: private equity firms earn their keep by creating more than they inherited. 

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Among the many approaches to value creation, one of the most powerful is the buy-and-build strategy.  In this article, we take a closer look at one of the common strategies.  

What is buy and build  

As the name suggests, the buy-and-build strategy answers this by creating value through scale. Instead of betting on a single company, managers construct a platform: they buy an initial foundation and then build around it with bolt-on acquisitions.  

The buy-and-build cycle explained 

The buy-and-build journey unfolds in distinct stages, each layering new sources of value onto the platform. Each step is designed to add a new layer of value — market reach, cost efficiency, cross-selling opportunities, professional leadership, digital infrastructure. Done well, the result is a business that is not just bigger, but better: more competitive, more resilient, and ultimately more valuable in the eyes of the next buyer. 

Screening 
The cycle begins with sourcing. Managers scan fragmented industries for target companies with strong fundamentals and clear integration potential. The goal is not just to find good businesses, but to map how they might fit together to form a platform. 

Consolidation 
Once a platform company is identified, bolt-on acquisitions are pursued to build scale. Here, the manager structures deals, negotiates terms, and ensures the portfolio develops along a coherent strategic plan. The challenge is combining speed with precision—moving quickly enough to capture opportunities, but carefully enough to avoid operational strain. 

Synergies 
As acquisitions are integrated, value creation accelerates. Managers drive cost efficiencies through shared procurement, consolidate back-office functions, and unlock revenue growth via cross-selling or expanded distribution. The effectiveness of this stage is a direct measure of how well the private equity firm executes on its investment thesis. 

Scaling 
With integration underway, the platform is professionalised and positioned for growth. Managers invest in leadership teams, technology, and expansion strategies. Success lies in strengthening competitive positioning and unlocking economies of scale without stifling the entrepreneurial energy that made the businesses attractive in the first place. 

Exit (Harvesting) 
Finally, the manager prepares the scaled platform for re-entry into the market, whether through IPO, trade sale, or secondary buyout. Timing and positioning are critical—returns hinge on demonstrating both the value created to date and the growth prospects ahead. 

Berlin Packaging: A growth strategy truly packs a punch 

The case of Berlin Packaging exemplifies this value-creation strategy. Berlin Packaging is a packaging supplier, serving companies in the beverage, food, industrial, and coatings sectors, as well as personal and household care. 

Founded in Chicago in 1988 when Andrew T. Berlin and his father acquired Alco Packaging and renamed it Berlin Packaging.  

Although most of its widely documented strategic bolt-ons came under private equity ownership, the firm had already begun stretching its strength through acquisitions. In 2000, it acquired Knap-Pac Containers, and in 2003, Freund Container, both aimed at extending its product lines and distribution reach.¹

In 2007, Investcorp acquired Berlin Packaging, which at the time had approximately USD 410 million in annual sales. The plan under PE ownership focused on supporting organic growth plus strategic bolt-on acquisitions. Over the following years (2010-2012) Berlin executed several key acquisitions —Continental Packaging Solutions, Lerman Container, and United States Container Corporation — which extended its North American footprint and operational depth.²,³,⁴

This initial phase of consolidation proved the viability of the buy-and-build model. 

Accelerated expansion and value creation 

The success of this strategy was validated in 2014 when Investcorp sold Berlin Packaging to Oak Hill Capital Partners for USD 1.43 billion.⁵,⁶ This transaction provided Investcorp with a return "better than three times" its initial capital, demonstrating the financial power of "multiple arbitrage"—where a larger, consolidated company commands a higher valuation multiple. 

Under Oak Hill's ownership, the pace of acquisitions accelerated dramatically. The company's strategic focus shifted from domestic consolidation to global expansion with key acquisitions such as Bruni Glass, H. Erben, and Novio Packaging. These acquisitions expanded Berlin Packaging into new geographic regions across Europe and new product verticals, including high-end spirits and cosmetics. 
To date, Berlin Packaging has acquired more than 35 businesses into its portfolio. Below are just some of their acquisitions.  

Operational professionalisation was a critical factor in managing this rapid growth. The company invested in a unified, cloud-based financial management platform to seamlessly integrate data from disparate ERP systems across its acquired entities. This move eliminated manual processes and ensured data consistency, which was essential for a high velocity of M&A activity. 

The company also invested "millions of dollars" into a multi-phase B2B e-commerce platform, which streamlined customer service and provided self-service tools, further enhancing its value proposition.These technological investments were a key component of the company's scaling strategy. 

Conclusion: It’s a wrap 

The Berlin Packaging case study provides a compelling blueprint for a successful private equity buy-and-build strategy. Its success hinged on three key factors: 

• Strategic platform selection: Investors backed a company that was already stable and expanding, reducing execution risk compared to a distressed turnaround. 

• Disciplined execution: Each acquisition was chosen to extend geographic reach or broaden product offerings, creating a repeatable and scalable process. 

• Operational modernisation: Private equity partners invested in technology, design, and service infrastructure, making it easier to integrate acquisitions and accelerate growth. 

The results are hard to dispute. In 2015, the company announced that they had crossed USD 1 billion in annual revenues,¹⁵ and according to Forbes revenue as of 2024 was USD 3.0 billion.¹⁶This trajectory demonstrates how a well-executed buy-and-build model can unlock explosive value creation and position a company for sustained market leadership.