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Packaging Corporation (PKG) Acquires Columbus Container

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Packaging products manufacturer Packaging Corporation of America (PKG - Free Report) has completed the acquisition of corrugated products producer, Columbus Container, Inc. for $100 million. The buyout is a strategic fit for Packaging Corporation and is expected to be immediately accretive to earnings.

Packaging Corporation has acquired a full-line corrugated products business located in Columbus, IN along with five warehousing facilities and other connected units located in Indiana and Illinois. The acquisition is anticipated to increase containerboard production by over 30,000 tons.

On Aug 29, Packaging Corporation completed the acquisition of TimBar Corporation for $386 million, in cash. The transaction was funded through a five-year term loan facility. This acquisition is estimated to increase containerboard integration by over 200,000 tons or 6% from its previous level of 87%. Further, the transaction allowed further optimization and enhancement of its mill capacity and was accretive with immediate effect.

PACKAGING CORP Price
 

PACKAGING CORP Price | PACKAGING CORP Quote

The company’s corrugated product manufacturing plants produce a wide variety of packaging products, including conventional shipping containers used to protect and transport manufactured goods. Further, it produces multi-colored boxes and displays with strong visual appeal that aid merchandise across retail locations. Additionally, Packaging Corporation is a large producer of packaging for meat, fresh fruit and vegetables, processed food, beverages as well as other industrial and consumer products. The diverse product portfolio neutralizes operating risks associated with any downturn in a particular product category and ensures a steady revenue stream.

Headquartered in Lake Forest, IL, Packaging Corporation is the fourth-largest producer of containerboard and corrugated packaging products in the U.S. and the third-largest producer of uncoated freesheet paper in North America. PCA operates eight mills and 95 corrugated products plants and related facilities.

Packaging Corporation carries a Zacks Rank #3 (Hold).

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