Sonoco, one of the largest diversified global packaging companies, today announced that it has signed a definitive agreement to acquire Weidenhammer Packaging Group, Europe’s leading provider of composite cans along with composite drums and rigid plastic containers, for €286 million, or approximately $383 million, in cash. The final consideration is subject to a normal adjustment of net working capital.
Weidenhammer Packaging, headquartered in Hockenheim, Germany, has approximately 1,100 employees and operates 13 production facilities, including five in Germany, along with individual plants in Belgium, France, Greece, The Netherlands, United Kingdom, United States, Chile and Russia. In addition to producing composite cans, drums and luxury tubes, Weidenhammer produces unique rigid plastic containers using state- of-the-art thin-walled injection molding technology with modern in-mold labeling. Markets served by the company include processed foods, powdered beverages, tobacco, confectionery, personal care, pet food, pharmaceuticals and home and garden products.
According to M. Jack Sanders, Sonoco president and chief executive officer, the acquisition of family-owned Weidenhammer Packaging Group will create a global leader in rigid paper packaging and is expected to increase Sonoco’s global consumer-related packaging and services business to approximately $2.8 billion in annual sales or approximately 53 percent of the Company’s combined revenue of approximately $5.3 billion. In addition, the combination is expected to increase Sonoco’s net sales in Europe to approximately 21 percent of total sales.
Weidenhammer Packaging’s projected 2014 sales are expected to be approximately €244 million, or $327 million, with projected EBITDA expected to be approximately €42 million, or $56 million (1). The transaction is expected to have no material impact to Sonoco’s 2014 base earnings and should be accretive to Sonoco’s 2015 base earnings in the range of $.09 to $.14 per share, including estimated adjustment for purchase accounting and first year synergies. Future accretion is expected through material internalization and other cost synergies.