Crown has agreed to acquire Signode Industrial Group, a leading provider of transit packaging systems and solutions, from The Carlyle Group for $3.91 billion.
The acquisition, which is subject to review by various competition authorities, is expected to close during the first quarter of 2018 and could significantly increase free cash flow. Debt financing has been fully committed in support of the transaction, Crown said.
With pro-forma sales and adjusted EBITDA of $2.3 billion and $384 million respectively for the 12 months ended 30 November, Signode is the world’s leading supplier of transit packaging systems and solutions, which consist of strap, stretch and protective packaging consumables and the associated application equipment and tooling.
Based in Glenview, Illinois, Signode’s global footprint includes operations in 40 countries across six continents, with sales to customers in approximately 60 countries.
Commenting on the transaction, Crown president and chief executive officer of Crown Timothy J Donahue said: “With this acquisition, we add a portfolio of premier transit and protective packaging franchises to our existing metal packaging business, thereby broadening and diversifying our customer base and significantly increasing our cash flow. Signode’s products supply critical in-transit protection to high value, high volume goods across a number of end-markets, including metals, food and beverage, corrugated, construction and agriculture, among others. Combined with its highly engineered equipment and service business, Signode offers full solutions to meet customers’ transit packaging needs. In addition to its equipment and protective packaging businesses, geographic and product mix provide a strong platform for value-creating growth.”
Signode CEO Mark Burgess said: “From the moment we became a standalone company, through three years of operational improvement, product development, and growth, the Carlyle team has partnered with us and been fully committed in helping create tremendous value to our franchise. Signode is excited to join the Crown team and continue delivering great value add solutions for our customers.”
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