Highlights
- IPACKCHEM is a global leader in premium barrier and
non-barrier jerrycans and small plastic containers
- Platform investment supports future growth in EMEA and APAC,
with unique barrier technology, best-in-class facilities across
five continents, and strong technical and operational
management
- Favorable exposure to secular growth markets in agriculture,
specialty chemicals, flavor & fragrances, and pharmaceutical
& medical diagnostics
- Financial profile is immediately accretive to EBITDA margins
and free cash flow
- Compelling value at 9.4x last twelve months adjusted EBITDA of
$57 million and 8.4x synergized1 EBITDA of $64 million for a global
leader with nearly 25% EBITDA margins and 65% cash conversion
- Planned acquisition is fully aligned with Greif’s enterprise
strategy of growing into margin-accretive, resin-based products
with strong circularity characteristics serving multiple end
markets
Note: all financials translated based on 1.05/1.00 EUR to USD
exchange rate as of October 18, 2023(1) Estimated synergies of $7
million represent Greif low-end estimate for synergy capture within
48 months of planned ownership based on information available as of
October 31, 2023; upside potential will be refined throughout that
period and updates will be communicated as synergies are
realized.
Transaction OverviewGreif,
Inc. (NYSE: GEF, GEF.B), a global leader in industrial packaging
products and services, announced today that it has entered into
exclusive negotiations to acquire I PACKCHEM Group SAS, a global
leader in premium barrier and non-barrier jerrycans and small
plastic containers, from an affiliate of SK Capital Partners, in a
cash transaction valued at $538 million. The planned transaction
would be funded through available capacity in Greif’s existing
credit facilities and would be expected to close by the end of the
second quarter of Greif’s 2024 fiscal year, subject to prior
completion of the information-consultation processes under French
law and closing conditions, including regulatory clearances.
IPACKCHEM is a global market leader in the production of high
performance plastic packaging. Headquartered in Paris, France, the
IPACKCHEM footprint includes over 1,400 employees in 13
operating facilities located in eight countries. For the last
twelve months ended September 30, 2023, IPACKCHEM generated
sales of approximately $235 million and adjusted EBITDA of
approximately $57 million.
A presentation containing additional information on the planned
acquisition is available for review at the Greif investor relations
website at https://investor.greif.com/.
“The IPACKCHEM portfolio is in perfect alignment with
Greif’s strategic growth aspirations in jerrycans and other small
plastics,” said Greif's President and Chief Executive Officer, Ole
Rosgaard. “Its state-of-the-art facilities are located in many of
the regions we already serve, leading to significant value creation
opportunities. Further, IPACKCHEM allows us to enter into new
and attractive geographies and end markets with a scaled position
upon which we can further grow through organic investment. Greif is
excited and will be eager to welcome the IPACKCHEM colleagues
to our family and create lasting value together when the planned
transaction is completed.”
“Over the last three decades IPACKCHEM built a global
platform delivering Safe, Sustainable, and Secure packaging
solutions and we are excited for our next chapter with Greif,” said
Jean-Philippe Morvan, Chief Executive Officer of IPACKCHEM.
“Greif’s industry expertise and customer service orientation will
enhance our value proposition to our global customer base,” Jean
Philippe added. “I would like to thank SK Capital for their strong
partnership through our most recent phase of transformational
growth.”
IPACKCHEM has been owned by SK Capital since 2021 and
Stephen D’Incelli, Managing Director at SK Capital, said: “It has
been a privilege to work closely with Jean-Philippe and
the IPACKCHEM team and we are pleased to have helped the
business execute significant organic and M&A investments to
drive value creation and attract a highly complementary strategic
buyer in Greif.”
AdvisorsStifel is acting as exclusive
financial advisor to Greif for the planned transaction. Allen &
Overy LLP, Trilegal and Pinheiro Neto Advogados are acting as legal
advisors to Greif. Goldman Sachs & Co. LLC is acting as lead
financial advisor to SK Capital Partners and other shareholders of
IPACKCHEM, with William Blair and Company acting as co-advisor.
Kirkland & Ellis is acting as legal advisor to SK Capital
Partners.
About Greif,
Inc.
Greif is a global leader in industrial packaging products and
services and is pursuing its vision: be the best performing
customer service company in the world. The Company produces steel,
plastic and fibre drums, intermediate bulk containers,
reconditioned containers, jerrycans and other small plastics,
containerboard, uncoated recycled paperboard, coated recycled
paperboard, tubes and cores and a diverse mix of specialty
products. The Company also manufactures packaging accessories and
provides filling, packaging and other services for a wide range of
industries. In addition, Greif manages timber properties in the
southeastern United States. The Company is strategically positioned
in over 35 countries to serve global as well as regional customers.
Additional information is on the Company's website at
www.greif.com.
About IPACKCHEMDuring its 35 years in the
marketplace, IPACKCHEM has become an international leader in the
design and manufacturing of innovative, high-performance rigid
plastic barrier packaging products (containers, bottles, jerrycans)
with uncompromising quality and service. IPACKCHEM takes pride in
providing sustainable, secure & safe UN-certified packaging
solutions technology for the transport of life enhancing
chemicals.
As a Platinum EcoVadis company, IPACKCHEM participates in
plastics circularity by producing barrier packaging that is 100%
recyclable and can contain up to 50% post-consumer recycled
polymer. Utilizing its world-class, high-efficiency manufacturing
plants and AIMF technology across five continents, IPACKCHEM is
committed to be the responsible solution for dangerous goods
transportation not only for the crop protection chemical market,
but also for the pharmaceutical, animal health and flavor &
fragrances industries.
Concerning Forward-Looking StatementsThis
release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 with respect
to Greif's plans to acquire IPACKCHEM and other statements
about future expectations, prospects, estimates and other matters
that are dependent upon future events or developments. These
forward-looking statements may be identified by words such as
"expect," "anticipate," "intend," "plan," "believe," "will,"
"should," "could," "would," "project," "continue," "likely," and
similar expressions, and include statements reflecting future
results, trends or guidance and statements of outlook. All
forward-looking statements are based on assumptions, expectations
and other information currently available to management. All
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those forecasted, projected or anticipated, whether expressed
or implied. These risks and uncertainties include: the ability to
successfully complete the applicable information-consultation
processes in France, the ability to successfully complete the
acquisition of IPACKCHEM on a timely basis, including receipt
of required regulatory approvals; the occurrence of any event,
change or other circumstance that could give rise to the
termination of the definitive agreement; the outcome of any legal
proceedings that may be instituted against the parties and others
related to the acquisition of IPACKCHEM; the satisfaction of
certain conditions to the completion of the acquisition of
IPACKCHEM; if the acquisition of IPACKCHEM would be completed,
the ability to retain the acquired businesses' customers and
employees, the ability to successfully integrate the acquired
businesses into Greif's operations, and the ability to achieve the
expected synergies as well as accretion in margins or cash flow;
competitive pressures in Greif's various lines of business; the
risk of non-renewal or a default under one or more key customer or
supplier arrangements or changes to the terms of or level of
purchases under those arrangements; uncertainties with respect
to tax or trade laws; the effects of any investigation or
action by any regulatory authority; and changes in foreign currency
rates and the cost of commodities. Greif is subject to additional
risks and uncertainties described in its Form 10-K, Form 10-Q and
Form 8-K reports and exhibits to those reports. This release
reflects management's views as of October 31, 2023. Except to
the extent required by applicable law, Greif undertakes no
obligation to update or revise any forward-looking statement.
Investor Relations contact information
Matt Leahy Vice President, Corporate Development & Investor
Relations / 740-549-6158 / Matthew.Leahy@Greif.com
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