The transaction will be effected at a fixed exchange ratio of 5.1 Amcor shares for each Bemis share, resulting in Amcor and Bemis shareholders owning approximately 71% and 29% of the combined company, respectively. This is equivalent to a transaction price of US$57.75 per Bemis share based on Amcor’s closing share price of A$15.28(4) on Aug. 3, 2018 and represents a premium of 25% to Bemis’ closing price of US$46.31 per share as of Aug. 2, 2018.
The sales of the combined company were $13 billion, EBIDTA was $2.2 million, and will have increased economies of scale and resources through Amcor’s leading positions in Europe, Asia and Latin America, and Bemis’ leading positions in North America and Brazil. Annual cash flow, after capital expenditure and before dividends, will be in excess of US$1 billion.
“The strategic rationale for this combination and the financial benefits are highly compelling for both Amcor and Bemis shareholders,” Amcor CEO Ron Delia said. “We are convinced this is the right deal at the right time for both companies, and with the right structure for both sets of shareholders to participate in a unique value creation opportunity. Amcor identified flexible packaging in the Americas as a key growth priority and this transaction delivers a step change in that region.
“There are an increasing number of opportunities arising for a leading packaging company to capitalize on shifting consumer needs, an evolving customer landscape and the need to provide responsible packaging solutions that protect the environment,” Delia added.
“The combination of Bemis and Amcor is transformational, bringing together two highly complementary organizations to create a global leader in consumer packaging,” William F. Austen, Bemis’ president and CEO, said.
“Our employees will benefit as part of a larger and more global organization focused on a commitment to customer service, integrity and supporting strong teams,” Austin noted. “In addition, the combination will enable us to offer global, regional and local customers the most compelling value proposition in the industry through a broader product portfolio, increased product differentiation and enhanced operating capabilities, while leveraging Bemis’ extensive US manufacturing base and strengths in material science and innovation. Our shareholders will receive a significant premium in this transaction, reflecting the value we’ve built as an organization, as well as the opportunity to continue to participate in the upside potential of a more diversified combined company with greater scale and resources. We look forward to working together with Amcor to ensure a seamless integration.”
“Amcor and Bemis have many things in common starting with proud histories that date back more than 150 years,” Delia concluded. “Both companies are grounded in strong values, a shared commitment to innovation and value-added consumer packaging, and have talented management teams. We have always had a great deal of respect for Bemis and we are thrilled that its team in Wisconsin and around the world will be joining Amcor. Many people at Amcor today have joined us through acquisitions, including many of our leadership team, and we would expect Bemis to be well represented in Amcor at all levels of the organization.”
Upon completion of the transaction, New Amcor’s Board is expected to comprise 11 members, eight of whom are current Amcor directors, and three of whom are current Bemis directors. Amcor’s current chairman, Graeme Liebelt and current CEO Ron Delia, will continue in those roles after the transaction and Delia will continue to serve as the only executive director on the Board.
New Amcor will continue to maintain a critical presence in Wisconsin and other key Bemis locations. The combined company also expects to leverage Bemis’ plant network and innovation center while continuing to invest in the US.
Closing of the transaction is conditional upon the receipt of regulatory approvals, approval by both Amcor and Bemis shareholders, and satisfaction of other customary conditions. Subject to the satisfaction of the conditions to closing, the transaction is targeted to close in the first quarter of calendar year 2019.
Amcor is a global leader in responsible packaging solutions, supplying a broad range of rigid and flexible packaging products into the food, beverage, healthcare, personal care and other fast moving consumer end markets. Amcor operates around 195 sites in over 40 countries, with approximately 35,000 employees. For the year ended June 30, 2017, Amcor generated revenues of US$9.1 billion and EBITDA of US$1.4 billion.
Bemis Company, Inc. is a supplier of flexible and rigid plastic packaging used by leading food, consumer products, healthcare, and other companies worldwide. Founded in 1858, Bemis reported 2017 net sales of US$4.0 billion. Headquartered in Neenah, WI, Bemis employs approximately 16,000 individuals worldwide.