The Welsh Government is supporting the acquisition with repayable finance to ensure the assets and equipment of Plastics Sorting are retained in Wales as a basis for investment and job creation.
Plastics Sorting Ltd established a 100,000 sq ft plastic sorting and purification plant in Blackwood in 2007 where it recycled plastic bottles and converted them into plastic flake but went into administration with the loss of 30 jobs.
The investment by Viridis Plastics UK Ltd, whose parent company is the Ireland based Viridis Plastics Group, will initially create 30 jobs - with the potential to increase to 80 jobs within three years.
Business Minister Edwina Hart said:
"I am pleased the Welsh Government is supporting Viridis Plastics with repayable business finance to ensure that the Blackwood facility achieves its full potential and becomes a leader in the sector.
"By supporting this acquisition it provides an opportunity to create a sustainable business with potential for growth that brings economic benefits and jobs to Wales.
"The company operates in the energy and environment sector, one of the Welsh Government’s priority sectors with potential for high growth and I am pleased to hear of their longer term proposals for the business."
The project involves the recycling/purification of waste materials to produce Polyethylene terephthalate (PET) in flake format for use primarily in the packaging industry.
Gregg Twomey, MD of Viridis Plastics Group, said their aim is to become a trusted supplier and processor of high quality material in the sector and to establish one of the largest plastic recovery businesses in the UK. They also hope to work with WRAP in the future to develop other plastic up cycling projects
"We have committed to a major, long term investment in this project and support from the Welsh Government has been pivotal in getting it off the ground.
"The Blackwood facility is the only recycling facility of its type in Wales and the largest in the West of the UK. It provides us with the opportunity to become the industry leaders in the development of recycled PET.
"We have some exciting and ambitious plans in the pipeline and want to grow the business in Wales. Our medium term plan includes establishing a plastic sorting facility in the South Wales valleys with the potential to create up to eighty jobs over the next three years."
He added they already have significant orders for 20,000 tons of PET and anticipate reaching capacity production within 18 months and have every confidence they will meet all targets.
The company estimates that the Blackwood facility will be operational from June and recruitment has already started.
Viridis will be exporting product to France, Germany and Ireland initially.