Berry Global has entered into a definitive agreement to sell its Specialty Tapes business (“Tapes”) to private equity firm Nautic Partners, LLC for approximately $540 million, subject to closing adjustments.
The Tapes division is highly regarded by industrial clients and its sale aligns with Berry’s strategic shift towards consumer-focused markets that are expected to deliver more consistent, higher growth. This divestment supports Berry’s broader transformation and its continued focus on consumer-oriented platforms.
Berry plans to use the proceeds from the transaction to reduce outstanding debt. After factoring in the expected cash distribution from the spin-off of Berry’s Health, Hygiene, and Specialties Global Nonwovens and Films business (“HHNF”) and the net proceeds from the Tapes sale, Berry’s pro forma net debt as of September 30, 2024, is estimated at approximately $5.9 billion, with a leverage ratio of 3.5x.
| As of September 30, 2024 | US$ in Billions | Berry (Reported) | HHNF and Tapes | Berry (Pro Forma) |
|---|---|---|---|---|
| Debt | 8.3 | 8.3 | – | 8.3 |
| Cash & Equivalents / Proceeds | (1.1) | (1.3) | (2.4) | (2.4) |
| Net Debt | 7.2 | (1.3) | 5.9 | 5.9 |
| EBITDA | 2.0 | (0.3) | 1.7 | 1.7 |
| Net Leverage | 3.5x | 3.5x | – | 3.5x |
| Revenue | 12.3 | 2.6 | 9.7 | 9.7 |
The deal is expected to close in the first half of 2025, pending customary closing conditions.
Berry’s CEO, Kevin Kwilinski, commented: “This transaction marks an important step in Berry’s transformation. By focusing on our high-growth consumer portfolio, we are enhancing our market position and better aligning our operations with evolving consumer demands.”
Goldman Sachs & Co. LLC is acting as Berry’s exclusive financial advisor, with Bryan Cave Leighton Paisner LLP providing legal counsel. McDermott, Will & Emery LLP is advising Nautic, while Santander is Nautic’s exclusive financial advisor.
Berry’s Upcoming Merger with Amcor
On November 19, 2024, Berry also announced its agreement to merge with Amcor in an all-stock transaction, aiming to create a global leader in consumer and healthcare packaging. The combined entity will boast an expanded offering in flexible and converted films, as well as a robust healthcare portfolio. Together, the companies will leverage innovation to drive growth and sustainability, with increased shareholder value.
The merger details, including synergies from the sale of the Tapes business, are expected to further strengthen the combined company’s financial standing.
For more information on the merger and transaction, visit Berry Global’s investor page.
About Berry Global
Berry Global is a leading provider of sustainable packaging solutions, known for its innovation, global reach, and commitment to improving the circular economy. With a workforce of over 34,000 employees across 200+ locations, Berry develops products that cater to customers’ sustainability needs while driving innovation.
About Nautic Partners
Based in Providence, Rhode Island, Nautic Partners is a private equity firm with expertise in healthcare, industrials, and services. Nautic has completed over 155 transactions throughout its 38-year history and focuses on driving growth in portfolio companies through strategic acquisitions and operational enhancements.
Important Information for Investors
This announcement does not constitute an offer to buy or sell securities. Berry and Amcor intend to file relevant materials with the SEC regarding the proposed transaction. Investors are encouraged to read these documents once available. Further details on the proposed merger and transaction can be found on the SEC’s website or through Berry and Amcor’s investor pages.
