Graphic Packaging Holding Company, through two of its subsidiaries, Graphic Packaging International and Graphic Packaging International Canada, agreed to acquire the assets of Seydaco Packaging Corp. and its affiliates National Carton and Coating Co., and Groupe Ecco Boites Pliantes Ltée. The acquisition is subject to standard closing requirements and is expected to close in the fourth quarter 2017.
This acquisition follows Graphic Packaging’s late October 2017 move to merge International Paper’s packaging operations in a transaction valued at US$1.8 billion. Expected to close in early 2018, this merger with IP would create one of the largest folding-carton and packaging operations in North America, generating approximately US$6 billion in revenues annually.
Seydaco is a privately held Canadian folding-carton producer headquartered in Mississauga, Ontario, focusing on the foodservice, food, personal care, and household goods markets. More specifically, Seydaco has become one of the country’s llargest suppliers of print work for manufacturers of cake, pie, pastry and pizza cartons.
Seydaco purchased National Carton in April 2015. The company today converts approximately 20,000 tons of paperboard annually and operates three converting plants located in Mississauga, Ontario, St.-Hyacinthe, Québec, and Xenia, Ohio.
Seydaco’s operations generated revenues of approximately $40 million over its most recent fiscal year. “The announced transaction is consistent with our strategy to pursue acquisitions that allow us to grow our folding carton volume in attractive geographies and end-markets, improve our cost position, increase our mill to converting plant integration levels over time, and that we can close at compelling post-synergy EV/EBITDA multiples,” said Michael Doss, President and CEO, Graphic Packaging.
Graphic Packaging explains synergies from the acquisition will be driven by the integration of additional paperboard tons and cost efficiencies. On a post-synergy basis, the company explains the EV/EBITDA multiple for this transaction is expected to be below 6.0X.
“We are delighted to join Graphic Packaging. Our employees and customers will truly benefit from this transaction,” said David Seychell, President of Seydaco. “Our history of providing customers with high-quality, value-added packaging solutions and our speed-to-market philosophy combined with their strong, global position will bring much added value to the paperboard packaging marketplace.”
Graphic Packaging Holding Company, headquartered in Atlanta, Georgia, is global company with two existing Canadian operations in Cobourg and Mississauga, Ontario.
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