Amcor sells three non-core flexible packaging plants to Integrated Packaging Group
One of the world’s largest packaging companies, Amcor, has announced the sale of three flexible packaging plants in Australia.
The three sites for sale are the Amcor Flexibles Packaging plants in Cheltenham (VIC), Chester Hill (NSW)and Kirrawee (NSW.) The sites were acquired as part of the Aperio acquisition and focused on non-core industrial and agricultural markets.
The packaging plants have been sold to Integrated Packaging, a privately-owned Australian business, although the transaction is subject to ACCC approval. The sale consideration is $22 million and was based on the same earnings before interest, taxes, depreciation and amortization (EBITDA) multiple as Amcor paid for Aperio.
IPG is Australia’s largest specialist manufacturer and distributor of stretch film wrap and associated products. The acquisition will reinforce IPG’s growth strategy in industrial and agricultural packaging, as well as expanding IPG into printing, converting and PVC food films.
The acquisition will be effective on the completion of the sale, which is expected late November 2012. However, as part of the sale, Amcor Flexibles Australasia will continue to provide certain services for IPG for a transitional period.
Amcor acquired Aperio, formerly a leading packaging competitor of Amcor, earlier this year after the ACCC approved the takeover in a statement that said they had considered there “would be a number of competitors to Amcor limited, particularly in the overseas market.”
In a statement following Amcor’s 2012 end of financial year report, Managing Director and CEO Ken McKenzie said that the year had represented a “record underlying profit and record returns.”
“In the current year it is expected that volumes will again be resilient and that the benefits from recent acquisitions, growth in emerging markets, cost reduction initiatives and continued strong cash focus will combine to deliver another year of higher earnings, expressed in constant currency terms,” Mr McKenzie said.
Synergies from the Aperio acquisition are not impacted by the sale and remain at $25 million by year three. The Amcor/Aperio name and brand will remain the property of Amcor Ltd, unaffected by the sale.