AUSTRALIA (From news reports) -- Orora has received regulatory approvals for the $1.775 billion sale of its North American packaging business to Veritiv Corporation.
The sale comprises Orora Packaging Solutions (OPS), which has almost 70 distribution and manufacturing facilities, and approximately 3,000 employees.
At the time, Orora said it will use $130 million of the funds to further expand its cans capacity at its Rocklea, Queensland operations.
The Rocklea expansion, in combination with recent and ongoing projects, will increase Orora's cans manufacturing capacity by more than 30%.
"Veritiv's interest in acquiring OPS provided us with an opportunity to realise an attractive valuation for shareholders and accelerate our strategy of becoming a focused, specialty value-added beverage packaging player," Orora CEO Brian Lowe said at the time.
Vertiv CEO Sal Abbate said the combination of OPS and Veritiv would significantly expand the groups capabilities in North America.
Currently, Veritiv is a full-service provider of packaging, janitorial sanitation and hygiene products, and also provides print and publishing services.
"Our complementary business strategies and core values make this partnership a natural fit, and I am confident the integration will create a stronger, more agile organization that sets new standards for excellence," Abbate said.
"By uniting two successful players with a shared commitment to innovation, sustainability, and exceptional customer experiences, we are poised to offer a wide range of products and value-added solutions that meet even the most complex packaging and supply chain needs."
In addition to the Rocklea expansion, Orora said it will use the funds to reduce debt and return proceeds to shareholders through an on-market share buyback.
"An initial commitment of up to 10% of the shares on issue (approximately $320 million) will commence following completion of the transaction," Orora said in a company statement.
Completion of the transaction is expected to occur this month, netting Orora approximately A$1.687 billion after tax, transaction costs and purchase price adjustments.
