Australian packaging company Amcor said on Friday it will buy a plastic container manufacturing business from US based Sonoco Products for $280 million.
The acquired business, Sonoco Specialty Containers, makes moulded packaging for food, drink and pharmaceuticals, Amcor said in a statement. It will expand Amcor’s rigid plastics division and allow the company to access US customers, Amcor said.
“Part of our strategy to grow this business includes acquiring specialized manufacturing capabilities which unlock further growth,” Amcor Chief Executive Ron Delia said in the statement.
Over many years Amcor Rigid Plastics has built a position in the specialty container segment through its Diversified Products business, by developing capabilities in house and acquiring specialised technologies.
This acquisition will significantly enhance Amcor’s product offering by adding complementary capabilities and technologies, including more extensive extrusion blow molding and injection technologies, expertise in producing polyethylene, polypropylene and multi-layer containers, as well as additional decorating capabilities.
Total sales of specialty benefits of approximately US$20 million and underlying market growth, this acquisition is expected to add approximately US$50 million of PBIT to Amcor’s Rigid Plastics segment at the end of the third full year of ownership. Additional growth opportunities underpinned by a broader product offering will further enhance returns on this acquisiton beyond that timeframe.
Amcor CEO and Managing Director Ron Delia said: “The Amcor Rigid Plastics business has significant growth opportunities, including in segments outside of the traditional non-alcoholic beverage markets. Part of our strategy to grow this business includes acquiring specialised manufacturing capabilities which unlock further growth in key segments.”