Avery Dennison acquires Vestcom intelligent label solutions provider for US$1.45B
29 Jul 2021 --- Avery Dennison is acquiring Vestcom, a privately held pricing and branded labeling solutions provider, for US$1.45 billion in cash.
Vestcom uses data management capabilities to synthesize and streamline store-level data and deliver item-specific, price-integrated messaging at the shopper’s point of decision.
The acquisition is expected to close in the third quarter of 2021, subject to regulatory approvals and other customary closing conditions.
Vestcom is headquartered in Little Rock, Arkansas, US, with roughly US$400 million in annual revenue. The company has 11 US production facilities and approximately 1,200 employees, with sales across multiple US retail channels, including grocery and drugs.
The label provider’s solutions include stackz pre-cut, pre-sorted self-adhering shelf labels, shelfStrips shelf-edge planogram displays, adSigns signage kits, and shelfAdz branded marketing displays.
Intelligent Labels strategy
Vestcom is described as a high-growth, high-margin business with a strong track record across cycles that will accelerate the Avery Dennison portfolio shift to high-value categories.
The acquisition is expected to be accretive to the company’s 2022 EPS (earnings per share), net of purchase accounting amortization and financing costs.
“Vestcom is a high-performing business that is a near adjacency to Avery Dennison RBIS,” comments Mitch Butier, Avery Dennison’s chairman, president and CEO.
Avery Dennison sees Vestcom as a high-growth, high-margin business.
“With this acquisition, we are expanding our position in high-value categories and adding complementary channel access and data management capabilities that have the potential to further accelerate our Intelligent Labels strategy.”
“Vestcom is a strong strategic fit for Avery Dennison RBIS with a well-established base of long-term, market-leading customers,” adds Deon Stander, vice president and general manager at Avery Dennison RBIS.
“It has a long history of continuous innovation and delivering products and services with strong value propositions and clear, measurable return on investment for its customers. It has consistently adhered to a proven growth strategy executed by an excellent management team.”
“Vestcom’s relationships and solutions, in combination with our own, will complement our strategy to accelerate Intelligent Label adoption beyond apparel. We look forward to learning from the Vestcom team and working together to drive significant value for all our stakeholders.”
Milestone for Vestcom
John Lawlor, Vestcom’s chairman and CEO, says the acquisition marks a significant milestone in the company’s history.
“The capabilities of Avery Dennison will enable Vestcom to further accelerate innovation and continue delivering high-value solutions that drive sales and productivity for retailers and CPGs,” Lawlor explains.
“And we look forward to bringing our expertise and data integration capabilities to new channels and markets with Avery Dennison. I look forward to this next chapter in our growth trajectory.”
Avery Dennison is a global materials science and manufacturing company specializing in designing and manufacturing a wide variety of labeling and functional materials.
The company’s products are used in nearly every major industry and include pressure-sensitive materials for labels and graphic applications, such as tapes and other bonding solutions for industrial, medical and retail applications.
Avery Dennison developments
Avery Dennison recently launched the latest iteration of its award-winning CleanFlake filmic label materials, now suitable for PET packaging in food, home and personal care, and beverage applications.
The company is committed to net-zero greenhouse gas emissions by 2050 and recently introduced new 2030 social and environmental sustainability goals.
PackagingInsights spoke with Rob Groen in ‘T Wout, marketing manager for films at Avery Dennison Label and Packaging Materials, about the critical actions required for a zero-waste future for packaging and labels.
By Joshua Poole
