Sealed Air Buys Automated Packaging Systems for $510M
May 2, 2019
Sealed Air has signed a definitive agreement to acquire Automated
Packaging Systems, Inc. (APS), a leading manufacturer of
high-reliability, automated bagging systems, for a purchase price of
$510 million on a cash and debt free basis.
APS provides full flexible packaging systems, including industry leading
equipment, sustainable materials and technical services. Known for
inventing Autobag bagging machines and pre-opened bags on a roll, APS
also offers three recycled film solutions under the EarthAware brand.
Founded in 1962 with headquarters in Streetsboro, Ohio, APS employs more
than 1,200 people, serves customers in over 60 countries and operates
seven manufacturing sites in the U.S. and U.K. In 2018, APS generated
$290 million in sales, an increase of approximately 10% year-over-year.
“Automated Packaging Systems is a market leader with unique and
innovative solutions, complete with automated equipment, materials and
services,” said Ted Doheny, Sealed Air President and CEO. “The addition
of APS is well aligned with our Reinvent SEE goal of doubling our
innovation rate over the next five years. This transaction expands the
breadth of our automated solutions and sustainable packaging offerings,
giving us access to growth opportunities in the markets we serve.”
“We look forward to working with the talented employees of APS. Their
culture of operational excellence, creative collaboration and innovation
built over 57 years is recognized and shared by Sealed Air,” continued
Doheny. “We are confident that the APS business will thrive as part of
our platform, given our global reach, distribution network and supply
Benefits of the Transaction
Expands Protective Packaging with Complementary Solutions and Services
APS brings highly complementary and additive capabilities to Sealed Air,
including expertise in engineering, automation technology and
sustainability, which strengthens the Company’s protective packaging
Accelerates Innovation, Consistent with Reinvent SEE Strategy
APS has a long track record of growth and innovation through machine
automation and converting technologies, supported by a robust patent
Drives Growth Opportunities, Cost Synergies and Accretive to Adjusted
Sealed Air will benefit from cross-selling opportunities enabling
additional growth in key markets. The Company also expects cost
synergies resulting from supply chain efficiencies. The transaction is
expected to be accretive to Adjusted EBITDA in 2019.
Financing and Approvals
Sealed Air intends to use cash on hand and credit facilities to finance
the transaction. The transaction is expected to close early in the third
quarter of 2019, subject to applicable regulatory reviews and customary
closing conditions. Upon the transaction closing, the Company plans to
update its 2019 full year outlook on the second quarter earnings
conference call, which is tentatively scheduled for July 31, 2019.
Goldman Sachs & Co. LLC served as exclusive financial advisor and K&L
Gates LLP acted as legal advisor to Sealed Air.