TC Transcontinental Printing (Montreal, Quebec) has agreed to acquire Coveris Americas (Chicago, Illinois) for $1.32 billion (USD) that shall be paid in cash, subject to customary closing adjustments and regulations. The deal is expected to close in mid-2018 and will further solidify Transcontinental as one of North America’s top companies in the flexible packaging sector. Last month, TC Transcontinental acquired Multifilm Packaging, a flexible packaging supplier located in Elgin, Illinois that employs over 70 people. The company has a solid reputation in the high-end candy and chocolate packaging verticals in North America – and specializes in piece-wraps and high-barrier laminates for the confectionery, snacks and dry foods markets. In October of 2017, Transcontinental acquired Les Industries Flexipak Incorporared in Quebec to further expand its reach in Eastern Canada. These recent moves reflect the fact that TC Transcontinental has been adding to its packaging assets while selling off some of its newspapers.
Coveris, one of the leading converters of flexible packaging in North America, manufactures paper products, labels and flexible plastics. It operates 21 production facilities in the Americas, the UK and Australasia, employs over 3,100 people, and has sales of approximately $966 million. “We’re very excited about the sale of our Americas business to TC Transcontinental,” said Jakob A. Mosser, CEO of Coveris. “This sale will enable us to focus on our operations in Europe, where we are one of the largest players in the flexibles and rigid-packaging market. This supports our recent strategic focus on delivering high performance and sustainable packaging solutions for our customers in the food, pet food, medical and pharmaceutical markets.” Coveris, which would be left with 44 facilities in 14 countries after the sale, is planning to use the proceeds from the sale to pay off existing debt. Transcontinental will use both existing cash assets and debt to finance the deal, which it believes will reduce costs by about $20 million over the next two years.