Checkpoint

CCL Industries Inc., a labeling and packaging company in Toronto, is buying Checkpoint Systems Inc. (NYSE: CKP), maker of retail security tags, for $443 million.

Checkpoint, based in Thorofare, New Jersey, will operate as a division of CCL, and the transaction is expected to close by June 30th. Checkpoint makes tags and labels used for loss prevention and inventory management, including radio frequency tags, for the retail and apparel industries.

CCL produces labels and related products, media and software solutions for digital printing, and aluminum aerosol cans and bottles, with customers in the consumer packaging, healthcare, chemicals, consumer products and automotive markets. The company has 13,000 employees at 122 plants.

Geoffrey Martin, CEO of CCL, says Checkpoint’s people under the CCL umbrella will continue to focus on smart-label technologies. Checkpoint operates in 29 countries, with revenues for the fiscal year ended Sept. 27, 2015, of $820 million (Canadian). CCL will finance the purchase with its $1.2 billion revolving syndicated credit facility.

Several middle-market deals involving packaging companies were announced in 2015. In December, WestRock Co. (NYSE: WRK), a paper distributor, announced plans to acquire the packaging division of Cenveo Inc.’s (NYSE: CVO) packaging division.

Also in December, Charter Nex Films Inc., with backing from Pamplona Capital Management, acquired Optimum Plastics Inc., a plastic film maker, from Huron Capital Partners LLC. Carr Management Inc., a bottle maker with backing from Behrman Capital, purchased Hillside Plastics Inc., a privately-held container maker, in October.

BMO Capital Markets is CCL’s financial adviser and Warner Norcross & Judd the company’s legal counsel on the deal. Morgan Stanley & Co. LLC is financial adviser to Checkpoint, with Latham & Watkins LLP and Stradley Ronon Stevens & Young LLP serving as legal counsel.

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