Ox Industries acquires a 150,000 square foot facility in Hanover, PA to expand its converting capacity in the Mid-Atlantic Region. The facility will house next-generation equipment and manufacturing practices and expand just in time stocking products and services. “We are excited to expand our Hanover location and to continue to invest in the community where we originally started OX. This is part of a $15 million investment in Hanover that will vertically integrate with our 100% recycled paperboard mills and create 50 new green-collar jobs,” said CEO Kevin Hayward.
Greif, Inc. (NYSE: GEF, GEF.B), a global leader in industrial packaging products and services, today announced it has entered into a definitive agreement to acquire Lee Container Corporation, Inc. (“Lee Container” or “Lee”), an industry-leading manufacturer of high-performance barrier and conventional blow molded containers, for a purchase price of $300 million before taking into consideration tax benefits with an estimated net present value of approximately $30 million. The all-cash transaction will be funded through Greif’s existing credit facility and is expected to close by the end of the calendar year, subject to customary closing conditions, including regulatory clearances.
Lee Container is a leader in North American blow molded jerrycan production, primarily serving growth-oriented customers in the agrochemical, other specialty chemicals, oil & lubricant, and pet care segments. Lee Container operates three strategically positioned manufacturing facilities in Homerville, GA, Centerville, IA, and Nacogdoches, TX, with over 500 employees throughout the U.S. For the trailing twelve months ended September 30, 2022, Lee generated sales of $162 million and adjusted EBITDA of $33 million. Additionally, as part of the acquisition, Greif expects to realize approximately $6 million in synergies within the first two years of ownership.
“The acquisition of Lee Container is a critical step in our continued Build to Last journey”, said Ole Rosgaard, President and Chief Executive Officer of Greif. “Lee is an exceptional strategic and cultural fit, with exceptional people and values as well as a favorable mix of product and end market exposures. The Lee acquisition solidifies our commitment to growing our jerrycan and small plastic bottle footprint and adds a further growth engine to our GIP business. I am excited to welcome our new colleagues to the Greif family and look forward to growing our business together with them.”
“The Lee Container family is excited for today’s announcement and the opportunities it presents for our colleagues, customers, and suppliers”, added Robert Varnedoe, Chief Executive Officer of Lee Container. “Greif brings additional industry expertise, scale, and customer service focus that will be formative in continuing the strong growth fundamentals of the company. Our customers and suppliers will benefit from the enhanced product offering of Greif, and I’m most excited that our colleagues will join a thriving, people-first culture at Greif.”
The acquisition represents numerous key strategic benefits, including:
*Offers immediate scale in jerrycans and small plastic bottles in North America, with a platform for future growth through both organic and inorganic reinvestment opportunities
*Provides favorable exposure to growing agricultural and specialty chemicals end markets, which offers portfolio diversification benefits to Greif’s GIP business mix
*Margin accretive transaction pre-synergies, with multiple levers for value creation and incremental synergy capture under Greif ownership
*Attractive return profile given strong strategic fit, upside optionality for growth, and strong cultural alignment with Greif