MOSCOW (MRC) -- Berry Plastics Group Inc said it would buy AEP Industries Inc (AEPI.O), which makes stretch wraps and can liners, in a deal valued at USD765 million, including debt, to expand its presence in North America, said Reuters.
Based on Berry Plastics' close on Aug. 23, AEP shareholders will receive either USD110 in cash or 2.5011 shares of Berry Plastics for each AEP share. The offer represents a premium of 42.9 percent to AEP's Wednesday close.
Upon closing of the stock and cash deal, AEP shareholders will own about 5 percent of Berry Plastics on a fully diluted basis, the plastic packaging products maker said on Thursday. AEP's long-term debt stood at USD209.7 million as of April 30.
"AEP, together with Berry's Engineered Materials Division, creates an impressive packaging film producer serving the North American market," Berry Plastics Chief Executive Jon Rich said. Berry Plastics, which makes duct tapes, spray adhesives and food wrap films, said it will fund the cash component of the deal with existing cash and a new term loan.
In July, Berry Plastics offered to buy Avintiv Inc, which makes materials used in products ranging from diapers to disinfectant wipes, for about $2.45 billion in cash from Blackstone Group LP.
Montvale, New Jersey-based AEP's flexible plastic packaging products are used in the consumer, industrial and agricultural markets. The deal, which is expected to be completed in December, will add to Berry Plastics' adjusted net income and adjusted free cash flow.
As MRC informed earlier, Berry Plastics Group Inc. is closing a consumer packaging manufacturing site in Dunkirk, N.Y., a move that will put more than 50 people out of work in the coming months.
Berry Plastics Group, Inc. is a leading provider of value-added plastic consumer packaging and engineered specialty materials delivering high-quality customized solutions to our customers. The Company’s world headquarters is located in Evansville, Indiana, with pro forma net sales of USD6.7 billion in fiscal 2015 and is listed on the New York Stock Exchange under the ticker symbol BERY.
MRC