Sonoco (NYSE: SON) has acquired Weidenhammer Packaging Group for about $383 million in cash.
Weidenhammer, headquartered in Hockenheim, Germany, provides composite cans, drums and rigid plastic containers. The company has 13 production facilities in Germany, Belgium, France, Greece, the Netherlands, U.K., U.S., Chile and Russia. Weidenhammer's packaging products are used by the processed foods, powdered beverages, tobacco, confectionery, personal care, pet food, pharmaceutical and home and garden products markets.
Hartsville, South Carolina-based Sonoco provides consumer packaging, industrial products, protective packaging, displays and supply chain services. The company has operations in 33 countries and almost 20,000 employees. Sonoco expects the acquisition to increase the sales of the company's consumer-related packaging business to about $2.8 billion annually. The target's projected 2014 sales are about $327 million.
Sonoco is paying for the deal with a combination of existing cash and debt, with an estimated combined net credit leverage ratio of 1.75 times at closing. The company says it plans to repay the debt from cash flow in 2015.
Macquarie Capital was Sonoco's financial adviser, while Reed Smith LLP provided legal advice. Deloitte Corporate Finance Advisory advised Weidenhammer.
The news comes on the same day that private equity firm Oak Hill Capital Partners announced it was buying Berlin Packaging LLC from Investcorp. Other packaging deals include Rhone Capital LLC's acquisition on Ranpak Holdings Inc. earlier in August, and Charter Oak Equity and Peninsula Capital Partners' purchase of a controlling stake in Seaboard Folding Box Company LLC, also in August.
For more on interest in the packaging space, see "Lenders Show Love for Packaging."