American packaging company Sonoco has agreed to acquire Germany-based Weidenhammer Packaging for an amount of approximately $383m (€286m).
Sonoco president and chief executive officer M Jack Sanders believes the acquisition will help them create a global leader in rigid paper packaging.
"Combining Weidenhammer's state-of-the-art production and technological capability places Sonoco in a leading position to provide its global consumer product customers with unparalleled packaging expertise throughout North America and Europe, and creates a strong presence in the emerging markets of Southeast Asia, China, Eastern Europe and South America," said Sanders.
The acquisition is expected to increase Sonoco's global consumer-related packaging and services business to approximately $2.8bn in annual sales or approximately 53% of its combined revenue of approximately $5.3bn.
The company is also looking to increase its net European sales to approximately 21% of total sales with the deal.
Weidenhammer CEO Ralf Weidenhammer said: "Sonoco and Weidenhammer bring 175 years of combined consumer packaging innovation and expertise to our combined customers. After almost 60 years of successful business operations, we are convinced that the merger with Sonoco will open up new opportunities for our business, our customers and partners, as well as to our employees."
Sonoco intends to fund the acquisition by combining existing cash and debt with a net credit leverage ratio of 1.75 times at closing.
Subject to governmental regulatory review, the acquisition is expected to close in the fourth quarter of 2014.
Headquartered in Hockenheim, Germany, Weidenhammer operates 13 production facilities, including five in Germany, along with individual plants in Belgium, France, Greece, The Netherlands, United Kingdom, United States, Chile and Russia.
