Berry Global Inc., the plastic packaging company that is Lawrence’s largest commercial employer, is being acquired by a Swiss competitor, Amcor PLC, in a deal worth about $8 billion.
The future of the company’s 1,115 Lawrence employees is unclear. In announcing the planned merger, the companies spoke of $650 million in efficiencies they might enjoy from combining operations over the next three years, but didn’t give any specifics. Corporate mergers of this type often involve some plant closings as the new owner consolidates locations.
Berry, which makes plastic drink cups in Lawrence, recently surpassed Hallmark Cards Inc. as the largest local private employer.
Under the terms of the deal, Berry stockholders will receive 7.25 Amcor shares for each of their Berry shares. Both companies trade on the New York Stock Exchange. Amcor stock is trading at just more than $10 a share, while Berry stock is at about $69 per share.
The prices of the two stocks jumped about 7% immediately after the deal was announced in mid-November, but have since settled back a bit. That may indicate that Wall Street is less than enthusiastic about the proposed merger, which is expected to be complete in the middle of next year.
As originally announced, the deal was worth $8.4 billion, but the decline of the stocks over the past two weeks has put the value at just more than $8 billion. Plastic packaging companies have suffered from a slowing of demand since a surge during the pandemic four years ago, according to Reuters news service.
The combined company will have annual revenue of $24 billion, serving customers in more than 140 countries through about 400 production facilities. Both companies are major players in plastic packaging; in addition to making drink cups in Lawrence, Berry makes plastic bags, bottles, applicators, building materials, tapes and films used in a variety of industries. Amcor makes many similar products used in the food, beverage and healthcare industries.
The Berry operations in Lawrence have their origins in a company originally called Packerware, which came to Lawrence in the early 1970s to make plastic cups used for serving drinks at football stadiums, including at the University of Kansas and the Green Bay Packers. Berry, which was founded in 1967 and is based in Evansville, Indiana, bought Packerware in 1997, and has expanded over the years through a series of acquistions. It currently has $12.3 billion in annual revenue and about 40,000 employees at more than 250 plants around the world.
Amcor got its start as the Australian Paper Mills Co. in Melbourne, Australia, in the 1800s. The company diversified into plastics and changed its name to Amcor in 1986 and then relocated its headquarters to Zurich, Switzerland. Prior to the planned merger with Berry, it had $13.6 billion in annual sales and 41,000 employees worldwide.
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August Rudisell/Lawrence Times
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