Sonoco completes ThermoSafe business unit sale to Arsenal Capital Partners
Key takeaways
- Sonoco sold its ThermoSafe business unit, which specializes in temperature assurance technology, to Arsenal Capital Partners for US$725 million.
- The sale is part of Sonoco’s strategy to streamline its operations, focusing on its core metal and paper packaging segments.
- The transaction includes a US$650 million cash payment, with an additional US$75 million contingent on performance in 2025.
Sonoco Products Company has finalized the sale of its ThermoSafe business unit to Arsenal Capital Partners. The private equity investment firm has purchased the temperature assurance technology division for US$725 million.
Sonoco signed a definitive agreement to sell ThermoSafe in September and has now completed the deal.
Howard Coker, Sonoco’s president and CEO, says: “The completion of the sale of ThermoSafe substantially concludes Sonoco’s portfolio transformation, which simplified our operations from a large portfolio of businesses into two core global business segments focused on metal and paper consumer and industrial packaging.”
“Sonoco is proud of what we have accomplished in building ThermoSafe into one of the industry’s leading players. We thank the entire ThermoSafe team for their dedication and wish them and their new owners continued success in the future.”
Transaction completed
The purchase price reportedly consists of US$650 million on a cash-free and debt-free basis payable at closing. An “additional consideration” of up to US$75 million may be included if certain performance measures for calendar year 2025 are met.
Net proceeds from the transaction will be used to repay existing debt, according to Sonoco.
The global packaging provider shares that, pro forma for the transaction, the expected net proceeds from the divestiture, excluding any additional consideration, are projected to reduce Sonoco’s net leverage ratio to approximately 3.4 x. This ratio is defined as third quarter total debt less cash and expected net proceeds divided by the midpoint of 2025 adjusted EBITDA guidance range less ThermoSafe’s pro forma adjusted EBITDA.
Morgan Stanley & Co acted as financial advisor to Sonoco. Freshfields acted as Sonoco’s legal advisor. Raymond James acted as lead financial advisor to Arsenal, and Kirkland & Ellis acted as Arsenal’s legal counsel.
