Veritiv acquired by CD&R in reported US$2.3B deal
08 Aug 2023 --- A Clayton, Dubilier & Rice (CD&R) affiliate is acquiring the global packaging firm Veritiv. Upon the completion of the transaction, expected to close by the end of this year, Veritiv will become a privately held company and shares of Veritiv common stock will no longer be listed on any public markets.
According to reports, the deal was cracked for US$2.3 billion, with shareholders receiving US$170 per share in cash, representing a premium of nearly 31% over Veritiv’s 30-day volume-weighted average price of US$129.89.
“Veritiv is a very well-positioned industry leader with differentiated capabilities that deliver value to customers,” states Rob Volpe, partner at CD&R.
“We look forward to supporting Veritiv’s talented leadership team in this next phase of the company’s growth as it continues to pursue its long-term strategic objectives while maintaining an unwavering commitment to employees, suppliers and customers.”
Veritiv’s board of directors unanimously approved the transaction and recommended that shareholders vote in favor of the transaction.
“The Veritiv management team has successfully executed its multi-year strategy to drive significant growth, and they have built substantial value in the business, which is reflected in the premium paid for the shares,” says Greg Ciongoli, partner at The Baupost Group.
Investments and divestments
In recent times, the packaging industry has witnessed a series of consolidation efforts as companies move toward environmentally sustainable offerings as a focus area. Earlier this week, One Rock Capital Partners acquired the world’s third-largest flexible packaging producer Constantia Flexibles.
“We look forward to partnering with Constantia’s management team to continue innovating to solve the evolving packaging needs and sustainability requirements of the company’s customers,” said Telmo Valido, partner at One Rock.
DS Smith acquired Serbian packager Bosis doo, targeting FMCG sustainability in Eastern Europe. “This acquisition will develop our ability to support customers, enhancing our regional capabilities and accelerating growth by offering world-class, sustainable and innovative products to many more customers,” remarked Miles Roberts, group chief executive at DS Smith.
Furthermore, closures and divestments were noted in the industry, with WestRock Company ceasing operations at its paper mill in Tacoma, US, Stora Enso selling assets at the Nymölla site in Sweden to Sylvamo, a US-based global producer of uncoated paper and Huhtamaki offloading its Russian assets for €150 million (~US$160 million) to local business Espetina.
Edited by Radhika Sikaria
