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Sonoco to Divest Rigid Plastics Blow Molding Operations
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The maker of consumer and industrial packaging products, Sonoco Products Co. (SON - Free Report) has entered into a definitive agreement to sell its rigid plastics blow molding operations to Amcor, an Australian packaging company, for $280 million. The transaction is subject to regulatory approvals in the U.S.
Sonoco’s rigid plastics blow molding operations manufacture moulded packaging for food, drink and pharmaceuticals. These operations include 7 manufacturing facilities in the U.S. and Canada with 850 employees.
This divestiture will help Sonoco to focus on its consumer packaging portfolio. The company will also be able to further the expansion of its targeted growth businesses after the sale. These businesses include flexible packaging, thermoforming rigid plastics and temperature-assurance packaging for transporting pharmaceuticals, biologics and vaccines.
Sonoco’s Consumer Packaging segment includes a broad range of cost-reduction projects, high-value flexible packaging enhancements, rigid plastic containers technology and next-generation composite packaging. During 2015, the company initiated restructuring actions in this segment comprising the closure of six rigid paper facilities, the closure of a production line at a thermoforming plant in the U.S., and the sale of a portion of its metal ends and closures business in the U.S.
Further restructuring actions will drive growth. Sonoco also remains focused on offsetting current economic, market and currency headwinds by further optimizing its supply chain, driving productivity improvements and streamlining its cost structure.
Sonoco currently has a Zacks Rank #3 (Hold).
Better-ranked stocks in the sector include Berry Plastics Group, Inc. (BERY - Free Report) , Packaging Corporation of America (PKG - Free Report) and ACCO Brands Corporation (ACCO - Free Report) . While Berry Plastics sports a Zacks Rank #1 (Strong Buy), Packaging Corporation of America and ACCO Brands carry a Zacks Rank #2 (Buy).
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Sonoco to Divest Rigid Plastics Blow Molding Operations
The maker of consumer and industrial packaging products, Sonoco Products Co. (SON - Free Report) has entered into a definitive agreement to sell its rigid plastics blow molding operations to Amcor, an Australian packaging company, for $280 million. The transaction is subject to regulatory approvals in the U.S.
Sonoco’s rigid plastics blow molding operations manufacture moulded packaging for food, drink and pharmaceuticals. These operations include 7 manufacturing facilities in the U.S. and Canada with 850 employees.
This divestiture will help Sonoco to focus on its consumer packaging portfolio. The company will also be able to further the expansion of its targeted growth businesses after the sale. These businesses include flexible packaging, thermoforming rigid plastics and temperature-assurance packaging for transporting pharmaceuticals, biologics and vaccines.
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Sonoco’s Consumer Packaging segment includes a broad range of cost-reduction projects, high-value flexible packaging enhancements, rigid plastic containers technology and next-generation composite packaging. During 2015, the company initiated restructuring actions in this segment comprising the closure of six rigid paper facilities, the closure of a production line at a thermoforming plant in the U.S., and the sale of a portion of its metal ends and closures business in the U.S.
Further restructuring actions will drive growth. Sonoco also remains focused on offsetting current economic, market and currency headwinds by further optimizing its supply chain, driving productivity improvements and streamlining its cost structure.
Sonoco currently has a Zacks Rank #3 (Hold).
Better-ranked stocks in the sector include Berry Plastics Group, Inc. (BERY - Free Report) , Packaging Corporation of America (PKG - Free Report) and ACCO Brands Corporation (ACCO - Free Report) . While Berry Plastics sports a Zacks Rank #1 (Strong Buy), Packaging Corporation of America and ACCO Brands carry a Zacks Rank #2 (Buy).
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>