Sonoco to acquire healthcare packaging and medical device thermoformer in US$187m deal
21 Nov 2019 --- Diversified global packaging company Sonoco has signed a definitive agreement to acquire Thermoform Engineered Quality and Plastique Holdings (together TEQ). TEQ is a global manufacturer of thermoformed packaging, serving the healthcare, medical device and consumer markets. Sonoco has agreed to acquire TEQ from ESCO Technologies for approximately US$187 million in cash.
TEQ, headquartered in Huntley, Illinois, US, produced sales of US$88 million in the fiscal year ending September 30, 2018. It operates three thermoforming and extrusion facilities in the US along with a thermoforming operation in the UK and thermoforming and molded-fiber manufacturing in Poland.
Each facility has state-of-the-art cleanroom capabilities, enabling the production of sterile, barrier packaging systems for pharmaceuticals and medical devices. Also, TEQ produces recyclable, molded-pulp-fiber packaging and thermoformed plastic packaging for multiple consumer products, primarily in Europe. The company has approximately 500 associates.
“Recent studies value the global healthcare packaging market at approximately US$33 billion, with healthy growth expected for the future,” notes Rob Tiede, Sonoco President and CEO. “Increased life expectancy, the steady introduction of new products from medical device manufacturers and pharmaceutical companies, combined with requirements for improved safety and compliance, are driving market growth.”
“TEQ provides a strong platform to further expand Sonoco’s growing healthcare packaging business, which includes our best-in-class ThermoSafe temperature-assured pharmaceutical packaging; injection-molded vials, multi-cell cuvettes and appliances; thermoformed trays for medical devices and OTC medical products, along with our Alloyd heat-sealing equipment for commercial medical applications.”
“The US and Europe will remain the largest consumers of healthcare packaging as new sophisticated therapies with specialized packaging needs continue to be introduced,” adds Randy Loga, President of TEQ.
“Surgical operations are also increasing due to a growing aging population, and with that comes the demand for more medical devices, which should strengthen the segment for the foreseeable future. TEQ’s history of growth mirrors the growth in healthcare spending and medical device utilization and we look forward to joining Sonoco in further expanding our capabilities to meet our customers’ future needs.”
Sonoco’s acquisition of TEQ is subject to normal regulatory review and projected to be completed by the end of 2019. There are no planned changes in TEQ’s leadership or customer relationships. The transaction is expected to be accretive to Sonoco’s 2020 earnings, and TEQ’s financial results will be reported within Sonoco’s Consumer Packaging segment.
Edited by Joshua Poole
