Sonoco to Acquire Peninsula Packaging Company
HARTSVILLE, S.C., Feb 16, 2017 (GLOBE NEWSWIRE via COMTEX) --
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Sonoco (NYSE:SON), one of the largest diversified global packaging companies, today announced it has signed a definitive agreement to acquire Peninsula Packaging Company for approximately $230 million in cash. Peninsula, which is owned by a fund managed by Odyssey Investment Partners, LLC, is a leading manufacturer of thermoformed packaging for fresh fruit and vegetables found in the fast-growing perimeter of retail supermarkets. The transaction is subject to normal regulatory review and is expected to close by the second quarter of 2017.
Founded in 2001, the Exeter, Calif.-based company has 2016 proforma sales of approximately $190 million(1) and operates five manufacturing facilities, four in the United States and one in Mexico. The majority of its business is focused on packaging for a wide range of whole fresh fruits, pre-cut fruits and produce and prepared salad mixes, as well as baked goods. Peninsula's customer base includes most of the leading household names for fresh fruits and vegetables found at retail.
"Our goal has been to strategically expand our consumer packaging portfolio to grow our offerings in both the center of the store and the fast growing perimeter," said Jack Sanders, Sonoco President and Chief Executive Officer. "With the addition of Peninsula, Sonoco will nearly double its thermoforming packaging capabilities and occupy a strong packaging position serving the perimeter in fresh food products, combined with our existing offerings in the center of the store, including those serving a range of frozen and shelf-stable foods."
Sonoco Executive Vice President and Chief Operating Officer Rob Tiede noted over the past several years, supermarkets have spent $15 billion growing their freshly prepared options in order to increase sales of items along the perimeter of the store, and recent industry research projects that perimeter store sales of fresh foods could achieve a compound average growth rate (CAGR) of between 6 percent and 7 percent over the next four years.
"Combining Peninsula's product lines with Sonoco's packaging capabilities positions us extremely well to capture new growth in the rapidly expanding fresh and natural category, while greatly accelerating and enhancing our ability to offer our customers the most diverse consumer packaging formats and solutions in the industry," Tiede said. "For example, this combination will allow Sonoco to deliver manufacturing and supply chain synergies gained from the connection between thermoformed trays and film lidding stock, which is an important customer differentiator."
William Blair served as financial advisor to Sonoco. Peninsula was advised by BMO Capital Markets and Lazard Middle Market.
(1) Proforma sales includes projected full-year sales from a new operation in Mexico which started in mid-year 2016.
Founded in 1899, Hartsville, S.C.-based Sonoco is a global provider of a variety of consumer packaging, industrial products, protective packaging, and displays and packaging supply chain services. With annualized net sales of $4.8 billion, the Company has 20,000 employees working in more than 300 operations in 33 countries, serving some of the world's best known brands in some 85 nations. For more information on the Company, visit our website at www.sonoco.com.
About Odyssey Investment Partners, LLC
Odyssey Investment Partners, LLC is a leading middle-market private equity firm with a 20-year history of partnering with management teams and investing in North American companies. With offices in New York and Los Angeles, Odyssey has acquired over 40 platform companies and over 125 add-on acquisitions.
About Peninsula Packaging
Peninsula Packaging is a provider of thermoformed plastic packaging products serving the fresh produce and bakery markets. Products include hinged containers (clamshells, produce trays, etc.), bases, lids and domes. Primary markets served include a wide range of berries, packaged salads and cut vegetables. Extrusion, thermoforming and labeling are managed from five production facilities located in Exeter, Calif., Hollister, Calif., Wilson, N.C., Yakima, Washington, and Guadalajara, Mexico.
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