Bemis To Acquire Alcan Packaging Food Americas
Neenah, Wisconsin, USA, 05 July 2009 -- Bemis Company, Inc. (NYSE: BMS) announced today that it has signed a definitive agreement to acquire the Food Americas operations of Alcan Packaging, a business unit of international mining group Rio Tinto plc (LON: RIO; ASX: RIO), for USD 1.2 billion. Pursuant to the agreement, Bemis will acquire 23 Food Americas flexible packaging facilities in the United States, Canada, Mexico, Brazil, Argentina, and New Zealand. These facilities produce flexible packaging for the food and beverage industries. The transaction is expected to be accretive to diluted GAAP earnings per share (EPS) beginning in 2010. For the year ended 31 December 2008, Alcan Packaging Food Americas recorded net sales of USD 1.5 billion and adjusted EBITDA of approximately USD 166 million. The purchase price represents an adjusted EBITDA multiple of approximately 6.7 times when taking into account the estimated USD 100 million of tax benefits related to the structuring of much of the transaction as a purchase of assets. Further adjusting the valuation for estimated annual run-rate synergies of USD 65 million results in an adjusted EBITDA multiple of approximately 4.8 times. The transaction is expected to close by the end of 2009, subject to customary closing conditions and regulatory review. "We are very pleased to add Alcan Packaging's Food Americas business to the Bemis organization," said Henry Theisen, Bemis president and chief executive officer. "Both Bemis and Alcan Packaging have strong, collaborative relationships with renowned food and consumer products customers. We each have a long history of dedication to outstanding quality and manufacturing excellence. In pooling our resources, we will diversify our existing technologies and product lines, which will broaden our product offering and augment our technical capabilities. This acquisition provides value from all angles and is a prudent investment in Bemis' future." Highlights of the transaction include the following:
"Bemis has historically maintained a strong balance sheet to ensure our ability to take advantage of opportunities like this," said Theisen. "Alcan Packaging Food Americas has demonstrated a commitment to investing in their operations and their workforce. The combined companies are expected to generate cash flow sufficient to rapidly reduce debt outstanding while maintaining our combined portfolio of world class manufacturing facilities, investing in growth opportunities, and supporting Bemis' historic dividend policy. The two companies clearly complement each other, and I'm looking forward to the exciting future this combination will bring." Barclays Capital and Greenhill & Co. are acting as financial advisors to Bemis for this transaction, while Baker & McKenzie LLP is acting as primary legal advisor to Bemis. About Bemis Company, Inc. About Alcan Packaging
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