Amcor Limited and Bemis Company combine in US$6.8 billion all-stock transaction

Amcor Limited has acquired Bemis Company in a US$6.8 billion all-stock combination.

Melbourne, Australia and Neenah, Wisconsin – Amcor Limited, and Bemis Company’s respective boards of directors have unanimously approved the definitive agreement in early August, 2018.

Combining these two companies will create a global leader in consumer packaging, with the footprint, scale and capabilities to drive significant value for shareholders, offer customers and employees the most compelling value proposition in the packaging industry and deliver the most sustainable innovations for the environment.

Amcor CEO Ron Delia said the strategic rationale for this combination and the financial benefits were highly compelling for both Amcor and Bemis shareholders.

READ: Global packaging company Amcor profit up

“We are convinced this is the right deal at the right time for both companies, and with the right structure for both sets of shareholders to participate in a unique value creation opportunity. Amcor identified flexible packaging in the Americas as a key growth priority and this transaction delivers a step change in that region,” said Delia.

The transaction will be effected at a fixed exchange ratio of 5.1 Amcor shares for each Bemis share, resulting in Amcor and Bemis shareholders owning about 71 per cent and 29 per cent of the combined company, respectively.

This is equivalent to a transaction price of US$57.75 per Bemis share based on Amcor’s closing share price of A$15.28(4) on August 3, 2018. It represents a premium of 25 per cent to Bemis’ closing price of US$46.31 per share as of August 2, 2018(5).

“There are an increasing number of opportunities arising for a leading packaging company to capitalise on shifting consumer needs, an evolving customer landscape and the need to provide responsible packaging solutions that protect the environment, said Delia.

“With this transaction, Amcor will have a stronger value proposition with the scale, breadth and resources to unlock value from these opportunities, for the benefit of our shareholders, customers and employees,” he said.

Amcor and Bemis had many things in common, starting with proud histories that dated back more than 150 years, said Delia.

“Both companies are grounded in strong values, a shared commitment to innovation and value-added consumer packaging, and have talented management teams,” he said.

Bemis president and CEO, William Austen, said the combination of Bemis and Amcor was transformational and all stakeholders would benefit.

“Our shareholders will receive a significant premium in this transaction, reflecting the value we’ve built as an organisation, as well as the opportunity to continue to participate in the upside potential of a more diversified combined company with greater scale and resources. We look forward to working together with Amcor to ensure a seamless integration,” he said.

“Our employees will benefit as part of a larger and more global organisation focused on a commitment to customer service, integrity and supporting strong teams. The combination will enable us to offer global, regional and local customers the most compelling value proposition in the industry through a broader product portfolio, increased product differentiation and enhanced operating capabilities, while leveraging Bemis’ extensive U.S. manufacturing base and strengths in material science and innovation,” said Austen.

After completion of the transaction, Amcor will have a stronger and more differentiated value proposition for global, regional and local customers.

It will have a comprehensive global footprint with more balanced, profitable exposure to emerging markets, and a greater scale to better serve customers in every region.

Global packaging company Amcor profit up

Global packaging company Amcor has reported a 15 per cent increase in statutory profit for the half year ended 31 December 2017.

The company said in a statement statutory profit for the half year ended 31 December 2017 was USD 329.7 million, while the figure profit after tax (PAT) of USD 329.7 million was up 3.7% on a constant currency basis.

Overall, the first half result were in line with expectations.

Amcor’s CEO Mr Ron Delia said: “During the half year we have grown earnings, expanded margins and maintained strong returns, with good progress on key investments. Cash flow and the balance sheet remain strong which, along with our confidence in the earnings growth capacity of the business, enabled the Board to increase the interim dividend by 8% to 21.0 US cents per share.

“The first half result was in line with the expectations we outlined at our AGM, and demonstrated the resilience and agility of Amcor in the context of short-term industry challenges related to raw material cost increases, weak volumes in one Rigid Plastics segment and mixed conditions in emerging markets.”


Amcor buys Chinese food packaging firm

Packaging giant Amcor is acquiring Hebei Qite Packing Co, a flexible packaging products maker based in the Northern China province of Hebei, for $US28 million ($36 million).

The business generates sales of over $36m in flexible packaging products to large domestic customers within the dairy and food segments.

Amcor currently has a total of eleven flexible packaging plants in China, including two plants in close proximity to Qite in Northern China. Once fully integrated, Amcor will have an even stronger platform to grow the business in this region.

“Amcor continues to have substantial opportunities to grow our flexible packaging business in the Asian region,” Amcor’s Managing Director and CEO, Ron Delia said in a statement.

“Globally and especially within Asia, China is a very attractive growth market for flexible packaging. This acquisition will enhance our already attractive platform for growth with new and existing customers in the important Northern region.”

Amcor has also completed the acquisition of North American-based Sonoco Products Company rigid plastics blow moulding operations.

The Sonoco business is a leading manufacturer of specialty rigid plastic containers for the pharmaceutical, personal care and specialty food segments with six production facilities in the United States and one in Canada.

The acquisition of Hebei Qite Packing Co remains subject to regulatory approvals.


Amcor acquires US plastics business

Australian packaging company Amcor said on Friday it will buy a plastic container manufacturing business from US based Sonoco Products for $280 million.

The acquired business, Sonoco Specialty Containers, makes moulded packaging for food, drink and pharmaceuticals, Amcor said in a statement. It will expand Amcor’s rigid plastics division and allow the company to access US customers, Amcor said.

“Part of our strategy to grow this business includes acquiring specialized manufacturing capabilities which unlock further growth,” Amcor Chief Executive Ron Delia said in the statement.

Over many years Amcor Rigid Plastics has built a position in the specialty container segment through its Diversified Products business, by developing capabilities in house and acquiring specialised technologies.

This acquisition will significantly enhance Amcor’s product offering by adding complementary capabilities and technologies, including more extensive extrusion blow molding and injection technologies, expertise in producing polyethylene, polypropylene and multi-layer containers, as well as additional decorating capabilities.

Total sales of specialty benefits of approximately US$20 million and underlying market growth, this acquisition is expected to add approximately US$50 million of PBIT to Amcor’s Rigid Plastics segment at the end of the third full year of ownership. Additional growth opportunities underpinned by a broader product offering will further enhance returns on this acquisiton beyond that timeframe.

Amcor CEO and Managing Director Ron Delia said: “The Amcor Rigid Plastics business has significant growth opportunities, including in segments outside of the traditional non-alcoholic beverage markets. Part of our strategy to grow this business includes acquiring specialised manufacturing capabilities which unlock further growth in key segments.”

Amcor expects problems in Venezuela, factory closures to hit profit

Amcor expects the deteriorating economic conditions in Venezuela and a restructuring of its flexibles business elsewhere to hit its profits over the next two years.

As AAP reports, the packaging giant’s rigid plastics business in Venezuela will be hit by a one-off charge of $US350 million ($A468.35 million) this year.

The company said in a statement state of the Venezuela economy has negatively affected its access to US dollars and therefore its ability to import raw materials.

Amcor CEO and Managing Director, Ron Delia said the company’s investment in Venezuela should be viewed from a long term perspective and that the action will help reduce risk.

“Importantly, Amcor will continue to generate strong cash flow and the ability to fund capital expenditure, acquisitions or dividends is unchanged,” he said in a statement.

On top of this, the company announced a restructure of its flexibles business. This will include streamlining organisation, particularly in Europe and the closure of plants in developed markets.

The restructuring will cost between $US120 million and $US150 million over the 2017 and 2018 financial years; and the company expects pre-tax profits to fall by between $US170 million and $US200 million over the current and next financial year.

“Amcor has strong flexible and tobacco packaging businesses in the developed markets with leading market positions which provide a solid platform for future growth. To build on that strong foundation, it is critical we continue to take decisive steps to align the organisation with market growth opportunities and customer needs,” Delia said.

Amcor wins twice at DuPont Packaging Awards

Amcor has been recognized by the 28th annual DuPont Awards for Packaging Innovation competition for its leadership in delivering technologically advanced and sustainable solutions for the home care and pharmaceutical industries.

Amcor Rigid Plastics earned a Diamond award in the Technological Advancement, Responsible Packaging, and Enhanced User Experience categories for the development of a 53oz polyethylene terephthalate (PET) bottle for Method Products which contains 100% post-consumer recycled (PCR) PET resin.

Meanwhile, Amcor Flexibles captured a Gold award in the Technological Advancement and Responsible Packaging categories for Formpack Ultra, a new cold form blister packaging for the pharmaceutical industry.

The awards program is an international, independently-judged competition that honors innovations in packaging design, materials, technology, and processes across the entire packaging value chain. Inaugurated in 1986, the DuPont Awards for Packaging Innovation is recognized globally as the leading packaging awards program.

“We are delighted to be recognized by DuPont for our commitment to innovation and sustainability,” said Jim Rooney, vice president of sales for Amcor Rigid Plastics’ Diversified Products business unit.

“Our primary objective is partnering with customers and creating unique solutions like this 100% PCR PET bottle which delivers major sustainability benefits for Method and reinforces its strong environmental platform.”

Asahi super dry shows off its new six pack

Asahi Super Dry has launched new packaging for its bottled 330ml product six pack baskets and cartons throughout Australia.

The new packaging was designed in Japan with the intention of creating a more premium feel to replicate the Asahi Super Dry brand positioning.

The Asahi Super Dry product itself remains completely unchanged offering exactly the same award winning beer with a fresh new exterior carton and six pack design. 

The bottle design remains unchanged. Michael Vousden, Beer and Cider Marketing Manager for Asahi Premium Beverages states: “The new Asahi Super  Dry packaging is sleek and  sophisticated,  mirroring  the qualities of the beer, in  line with our consumer base.” 

The revamped look is a refreshing update for the brand aesthetic and we look forward to getting it out into the market.”

”The new six pack and carton packaging is predominately black and showcases a  more simplistic  design, featuring the Asahi Super Dry logo and an image of the  bottle surrounded by crisp, ice cold vapour.  In comparison, previous packaging featured vibrant images and a red and white colour scheme.”

The minimalist and sophisticated new black and silver look complements the same great Asahi Super Dry product, offering a rich, full-flavoured beer with a refreshing after taste. “