Sonoco Sells Thermoformed Packaging Business to Toppan for $1.8 BillionSonoco Sells Thermoformed Packaging Business to Toppan for $1.8 Billion

Tokyo-based Toppan Holdings Inc. has entered into an agreement to acquire Sonoco Products Co.'s Thermoformed & Flexible Packaging (TFP) business for approximately $1.8 billion on a cash-free and debt-free basis. The acquisition is subject to customary adjustments.

Toppan said the acquisition is highly complementary to its global packaging business, bringing under its wing the robust sales network, customer base, and solution development capabilities of Sonoco's TFP business in North and South America.

Thermoformed and flexible packaging business serves range of sectors

Sonoco's TFP is a leading thermoformed and flexible packaging business serving a range of customers in food, retail, and medical verticals. TFP provides a variety of complex packaging to value-added categories including snacks, condiments, healthcare, prepared meals, fresh products, coffee, and pet food, said the news release. On a pro forma standalone basis, TFP had revenue of approximately $1.3 billion in 2023.

“The decision to sell our TFP business accelerates our portfolio simplification strategy, streamlines our organizational structure, and enables more focused capital investments in our remaining industrial paper and consumer packaging businesses,” said Sonoco President and CEO Howard Coker in a prepared statement. “TFP is a great business with leadership positions in its served markets. We greatly value TFP’s tenured history as part of the Sonoco family, and I am personally proud of their long-standing commitment to serve our customers with both innovative and high-quality packaging products. We will work closely with Toppan to ensure a successful transition for our employees, customers, and suppliers and wish the entire team all the best in the future,” said Coker.

Related:Sonoco Debuts Injection-Molded 3-Piece Plastic Can

Net proceeds from the transaction will be used to repay existing debt, Sonoco said.

Sonoco: Plant shutdowns, major acquisition

Earlier this month, Sonoco finalized its acquisition of Eviosys, a Switzerland-based supplier of metal packaging with a global footprint. The deal was valued at $3.8 billion. In 2023, as reported in PlasticsToday, the company shut down packaging plants in California and Indiana.

Sustainability at global scale

Toppan has articulated a medium-term strategy for transforming its portfolio and driving sustainable packaging solutions at global scale. The company’s stated mission is to “foster a society focused on well-being and sustainability, while safeguarding our planet for future generations, through the continuous development of innovative packaging solutions that explore cutting-edge materials and technologies."

Houlihan Lokey is acting as lead financial advisor and Morrison & Foerster LLP is acting as legal advisor to Toppan. Mitsubishi UFJ Morgan Stanley Securities Co. Ltd. is also acting as financial advisor to Toppan.

Goldman Sachs & Co. LLC is acting as lead financial advisor and Freshfields LLP is acting as legal advisor to Sonoco. RBC Capital Markets, LLC is also acting as financial advisor to Sonoco.