Amcor is set to acquire US packaging company Bemis in a $6.8bn all-stock transaction
Australian based manufacturer Amcor is set to acquire plastic packaging US company Bemis, leading the business to become the largest plastic packaging manufacturer worldwide. The acquisition is the largest by the company to date and will open the doors for Amcor to gain greater entry into the North American packaging market.
Creating a combined company valued at $23bn, the business will become 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.
At present, Bemis encompasses 57 plants worldwide, and has renowned consumers such as Unilever and PepsiCo under its portfolio.
Amcor will acquire Bemis in an all-stock combination, where the transaction will be affected at a fixed exchange ratio of 5.1 Amcor shares for each Bemis share, resulting in Amcor and Bemis shareholders owning approximately 71% and 29% of the combined company, respectively.
"The strategic rationale for this combination and the financial benefits are highly compelling for both Amcor and Bemis shareholders. 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,” explained Amcor CEO, Ron Delia.
“There are an increasing number of opportunities arising for a leading packaging company to capitalize on shifting consumer needs, an evolving customer landscape and the need to provide responsible packaging solutions that protect the environment. 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.”
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Bemis’ President and CEO, William F. Austen, said: "The combination of Bemis and Amcor is transformational, bringing together two highly complementary organizations to create a global leader in consumer packaging. We believe this combination, which is an exciting growth story for both companies, will benefit all stakeholders.
“Our employees will benefit as part of a larger and more global organization focused on a commitment to customer service, integrity and supporting strong teams. In addition, 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 US manufacturing base and strengths in material science and innovation.
“Our shareholders will receive a significant premium in this transaction, reflecting the value we’ve built as an organization, as well as the opportunity to continue to participate in the upside potential of a more diversified combined company with greater scale and resources.”
Upon completion, the new company, (New Amcor) will gain a increase comprehensive, global footprint, with more balanced, profitable exposure to emerging markets, and greater scale to serve customers in every region. The company will also become a tax resident in the UK, as well as gain a primary listing on the New York Stock Exchange, as well as a listing on the Australian Stock Exchange. “We believe the listing in New York in particular and the market capitalisation, which will approach $US20 billion once the synergies are factored in, will put us sort of midway in the S&P500 index and create index buying,” Mr Delia added.