Up until the past year or so, the publication printing market has been a major focus of consolidation efforts, with R.R. Donnelley and Quad/Graphics purchasing competitors. There was no such movement this year, as the focus was primarily on packaging.
The largest acquisition of the year was the completion of Ball Corporation’s takeover of Rexam PLC, forming the largest global beverage can manufacturer. After the acquisition, Ball has 75 metal beverage manufacturing facilities and JVs, and net 2015 sales of approximately $11 billion.
The other sizable move came in the RFID space, as CCL Industries acquired Checkpoint Systems. Checkpoint Systems had sales of $820 million in 2015. This will allow CCL to add RFID to its label portfolio.
“We have admired Checkpoint for many years as they built a unique, leading global position providing technology-driven label solutions to the retail and apparel industry,” said Geoffrey T. Martin, president and CEO of CCL Industries, in announcing the purchase. “We are very pleased to welcome their deeply experienced people to CCL where they will continue to focus on this important industry for emerging ‘smart label’ technologies.”
In a key move in the label industry, RAKO, X-label and Baumgarten, three of largest independent label manufacturers, agreed to merge their operations. RAKO Group and X-label Group are headquartered in Germany, while Baumgarten is located in Brazil. Together, their annual sales are more than $500 million, and they have 30 production sites across the globe, with more than 3,000 employees. They print more than 60 billion labels between them.
On the materials front, there were two huge M&As, beginning with Berry Plastics Group purchasing AEP Industries Inc. AEP Industries produces flexible plastic packaging films in North America. AEP has 14 manufacturing facilities in the US and Canada, with approximately 2,600 employees and $1.1 billion in sales during the previous 12 months.
In the other move, International Paper purchased Weyerhaeuser’s pulp business, including five pulp mills (three in the US, one in Canada and one in Poland) and two converting facilities, for nearly $2.2 billion. Weyerhaeuser’s pulp division has approximately 1,900 employees.
Outside of companies making their own acquisitions, venture capital firms waded into the printing industry with a few major acquisitions.
Advent International acquired a majority stake in Fort Dearborn, the third-largest supplier of prime labels in North America, from KRG Capital Partners. CVC Capital Partners added ÅR Packaging, a European packaging specialist with approximately $600 million in sales in 2015, from Ahlstrom Capital and Accent Equity.
The largest move in the printing industry was actually a separation, with R.R. Donnelley & Sons breaking into three parts. The printing portion of RR Donnelley is a $7 billion global marketing and business communications solutions provider with 42,000 employees across 28 countries.
Many of the acquisitions are regional in nature, as companies look to expand their presence in attractive areas. Here is a breakdown of key moves by region:
• Asia-Pacific: International Paper sold its corrugated packaging business in Asia, including 18 plants and approximately 3,000 employees, to Xiamen Bridge Hexing Equity Investment Partnership Enterprise.
In northern China, Amcor acquired Hebei Qite Packing Co. Ltd., which generated $28 million in flexible packaging for dairy and food sales in 2015. In southern China, Amcor picked up BPI China, a flexible packaging printer.
“Amcor continues to have substantial opportunities to grow our flexible packaging business in the Asian region,” said Ron Delia, Amcor’s managing director and CEO. “Globally and especially within Asia, China is a very attractive growth market for flexible packaging.”
Graphic Packaging acquired Colorpak, a leading Australia and New Zealand folding carton converter. Colorpak had three plants, two in Australia and one in New Zealand.
• Europe: CCL Industries picked up a host of companies, beginning with Woelco AG, Stuttgart, Germany. Woelco AG, which has operations in the US and China, had sales of $31 million, in 2015; the company manufactures labeling systems for the industrial and automotive markets. In Ireland, CCL added Label Art Ltd. and Label Art Digital Ltd., pressure sensitive label specialists with 2015 sales of $17 million, as wel as Label1, Belfast, Northern Ireland, which had sales of $10.7 million.
On the label side, Multi Packaging Solutions purchased UK-based AJS Labels, which focuses on self-adhesive labels.
• North America: In the largest move, WestRock and Grupo Gondi combined their respective operations in Mexico, completing their folding carton and corrugated printing JV in April. Under the terms of the JV, WestRock’s three packaging plants were combined with Grupo Gondi’s 10 facilities. All told, the JV, which is 75% owned by Grupo Gondi, employs 6,800 people.
“With this authorization Gondi expands its presence in the Mexican market by offering better alternatives to our customers with advanced technology and an expanded portfolio of solutions for paper packaging,” said Eduardo Posada, CEO of Grupo Gondi.
Grupo Gondi also bought Aluprint Plegadizos, Constantia Flexibles’ folding carton business in Mexico. Aluprint Plegadizos has approximately 600 employees.
In another move, WestRock acquired Cenveo Packaging, a division of Cenveo, Inc. With annual sales of approximately $190 million, Cenveo Packaging’s focus is on folding carton and litho-laminated display packaging solutions, and brings with it seven facilities in North America.
Transcontinental Inc. has been branching out into the flexible packaging field, and made two acquisitions of note during 2016, bringing in Richmond, BC-based Flexstar Packaging Inc. and Robbie Manufacturing, Lenexa, KN. Flexstar Packaging had approximately $32 million in sales during the past year, while Robbie Manufacturing brought in $50 million in sales in 2015.
“This acquisition is great news for the ongoing development of our flexible packaging division, an important area of growth for the corporation,” François Olivier, president and CEO of TC Transcontinental, said after the Robbie transaction.
Graphic Packaging acquired Walter G. Anderson, Inc., which had two plants in Minnesota and Iowa, as well as Metro Packaging & Imaging, Inc., Wayne, NJ.
“The acquisition of WG Anderson is a continuation of our strategy to grow in attractive geographies and end markets,” said Michael Doss, Graphic Packaging’s president and CEO.
Packaging Corporation of America (PCA) acquired TimBar Corporation, Hanover, PA, a corrugated products producer. TimBar had sales of $324 million in 2015. PCA also picked up Columbus Container, a corrugated packaging producer. Sonoco purchased Plastic Packaging Inc., a Hickory, NC-based flexible packaging specialist with estimated 2016 sales of approximately $42 million. In other acquisitions, Multi Packaging Solutions acquired i3 Plastic Cards, Dallas, TX, which specializes in creating and personalizing plastic transaction cards.
• South America: Amcor acquired Alusa, one of the largest flexible packaging printers in South America. Alusa had sales of $375 million in 2015, and brings to Amcor the following subsidiaries: Alusa (Chile), Peruplast (Peru), Aluflex (Argentina) and Flexa (Colombia). The company is focused on the food, personal care and pet food markets.
“A large number of Amcor’s multinational customers operate in South America, and this acquisition significantly improves our ability to support their needs and to grow with them in these markets,” Ron Delia, Amcor CEO and managing director, said after the acquisition.