Sonoco announced it has signed a definitive agreement to acquire Peninsula Packaging Company for approximately $230 million in cash. Peninsula, which is owned by a fund managed by Odyssey Investment Partners, LLC, is a leading manufacturer of thermoformed packaging for fresh fruit and vegetables found in the fast-growing perimeter of retail supermarkets. The transaction is subject to normal regulatory review and is expected to close by the second quarter of 2017. Founded in 2001, the Exeter, Calif.-based company has 2016 proforma sales of approximately $190 million¹ and operates five manufacturing facilities, four in the United States and one in Mexico. The majority of its business is focused on packaging for a wide range of whole fresh fruits, pre-cut fruits and produce and prepared salad mixes, as well as baked goods. Peninsula’s customer base includes most of the leading household names for fresh fruits and vegetables found at retail. click Read More below for additional detail
Sonoco (NYSE:SON), one of the largest diversified global packaging companies, today announced it has completed the acquisition of Clear Lam Packaging, Inc., a family-held developer and manufacturer of flexible and forming plastic packaging films, for approximately $170 million in cash.
Founded in 1969, the Elk Grove Village, Ill.-based company is projecting 2017 sales of approximately $140 million and operates state-of-the-art manufacturing facilities in Elk Grove Village and Nanjing, China, with nearly 400 total employees. Clear Lam is a technology leader in the development, production and conversion of high barrier flexible and forming films used to package a variety of products for consumer packaged goods companies and retailers, with a focus on structures used for perishable foods. Clear Lam President and CEO James Sanfilipo and other key members of its management team are expected to remain with the company. Clear Lam’s financial results will be added to Sonoco’s Consumer Packaging segment.
“One of the main attractions for us was the opportunity to leverage Clear Lam’s expertise in modified atmosphere packaging, which comes from a strong base of material science knowledge when it comes to films, additives and adhesives,” said Rob Tiede, Sonoco executive vice president and chief operations officer. “Clear Lam has also developed new portion-control condiment packaging, peel-reseal films for fresh fruits and vegetables, forming films for healthy yogurts, lidding films for fresh guacamole and several new packaging films that expand shelf life. The addition of their portfolio and technical capabilities for producing multi-layer film structures enhances and expands our ability to serve the rapidly growing perimeter of supermarkets in fresh food products, while driving synergies through the internalization of materials for Sonoco’s existing flexible and thermoforming customers.”
To finance the transaction, Sonoco is utilizing available credit facilities, including a new $750 million bank credit facility. Included in the facility is a new $500 million, five-year revolving credit facility, which increases an existing $350 million facility under substantially the same terms and bank group. The new revolver continues to support the Company’s existing $350 million commercial paper program. Also included in the credit facility is a new $250 million five-year term loan which was used to repay an existing $150 million loan and provides $100 million to partially fund the Clear Lam acquisition. The new term-loan has consistent terms and bank group with the revolver.