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Sonoco Inks $1.8B Deal with TOPPAN to Sell Thermoformed Packaging Business in Strategic Pivot

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Sonoco Inks .8B Deal with TOPPAN to Sell Thermoformed Packaging Business in Strategic Pivot





Sonoco Products Company (NYSE: SON) has announced an agreement to sell its Thermoformed and Flexibles Packaging (TFP) business to TOPPAN Holdings Inc. for approximately $1.8 billion on a cash-free and debt-free basis. The transaction is expected to close in the first half of 2025, subject to regulatory approvals. The net proceeds will be used to repay existing debt.

This strategic move aims to simplify Sonoco’s portfolio, streamline organizational structure, and enable more focused capital investments in their remaining industrial paper and consumer packaging businesses. The company will work with Toppan to ensure a smooth transition for employees, customers, and suppliers.

Sonoco Products Company (NYSE: SON) ha annunciato un accordo per vendere la sua attività di Packaging Termoformati e Flessibili (TFP) a TOPPAN Holdings Inc. per circa 1,8 miliardi di dollari su base priva di debito e di risorse liquide. Si prevede che la transazione si concluda nel primo semestre del 2025, soggetta alle approvazioni regolatorie. Il ricavato netto sarà utilizzato per rimborsare il debito esistente.

Questa mossa strategica mira a semplificare il portafoglio di Sonoco, rendere più snella la struttura organizzativa e permettere investimenti di capitale più mirati nelle rimanenti attività di carta industriale e imballaggi per consumatori. L’azienda collaborerà con Toppan per garantire una transizione fluida per dipendenti, clienti e fornitori.

Sonoco Products Company (NYSE: SON) ha anunciado un acuerdo para vender su negocio de Empaque Termoformado y Flexible (TFP) a TOPPAN Holdings Inc. por aproximadamente 1,8 mil millones de dólares en una base libre de efectivo y de deudas. Se espera que la transacción se cierre en la primera mitad de 2025, sujeta a aprobaciones regulatorias. Los ingresos netos se usarán para pagar la deuda existente.

Este movimiento estratégico tiene como objetivo simplificar el portafolio de Sonoco, agilizar la estructura organizativa y permitir inversiones de capital más enfocadas en sus restantes negocios de papel industrial y empaque para consumidores. La compañía trabajará con Toppan para asegurar una transición fluida para empleados, clientes y proveedores.

Sonoco Products Company (NYSE: SON)는 자사의 열성형 및 유연 포장(TFP) 사업부를 TOPPAN Holdings Inc.에 약 18억 달러에 현금 및 부채 없는 기준으로 판매하기로 합의했다고 발표했습니다. 이 거래는 2025년 상반기 내에 마무리될 것으로 예상되며, 규제 승인에 따라 다릅니다. 순수익은 기존 부채 상환에 사용될 것입니다.

이번 전략적 조치는 Sonoco의 포트폴리오를 단순화하고 조직 구조를 간소화하며 남아 있는 산업용 종이 및 소비자 포장 사업에 대한 보다 집중된 자본 투자 가능성을 열기 위한 목적입니다. 회사는 직원, 고객 및 공급업체의 원활한 전환을 보장하기 위해 Toppan과 협력할 것입니다.

Sonoco Products Company (NYSE: SON) a annoncé un accord pour vendre son activité d’emballages thermoformés et flexibles (TFP) à TOPPAN Holdings Inc. pour environ 1,8 milliard de dollars sur une base sans dette et sans liquidités. La transaction devrait être conclue au cours de la première moitié de 2025, sous réserve d’approbations réglementaires. Le produit net sera utilisé pour rembourser la dette existante.

Ce mouvement stratégique vise à simplifier le portefeuille de Sonoco, à rationaliser la structure organisationnelle et à permettre des investissements en capital plus ciblés dans ses activités restantes de papiers industriels et d’emballages pour consommateurs. L’entreprise travaillera avec Toppan pour garantir une transition fluide pour les employés, clients et fournisseurs.

Sonoco Products Company (NYSE: SON) hat bekannt gegeben, dass sie eine Vereinbarung zur Veräußerung ihres Geschäfts mit thermoformbaren und flexiblen Verpackungen (TFP) an TOPPAN Holdings Inc. für etwa 1,8 Milliarden Dollar auf einer schuldenfreien und liquiditätsfreien Basis getroffen hat. Der Abschluss der Transaktion wird für die erste Hälfte des Jahres 2025 erwartet, vorbehaltlich behördlicher Genehmigungen. Der Nettogewinn wird verwendet, um bestehende Schulden zu tilgen.

Dieser strategische Schritt zielt darauf ab, das Portfolio von Sonoco zu vereinfachen, die organisatorische Struktur zu straffen und gezielte Investitionen in ihre verbleibenden Geschäftsbereiche Papierindustrie und Verbraucherverpackungen zu ermöglichen. Das Unternehmen wird mit Toppan zusammenarbeiten, um einen reibungslosen Übergang für Mitarbeiter, Kunden und Lieferanten zu gewährleisten.

Positive


  • Sale of TFP business for $1.8 billion, strengthening balance sheet


  • Net proceeds to be used for debt reduction


  • Strategic portfolio simplification to enhance focus on core businesses


  • Streamlined organizational structure


Negative


  • Divestment of a leadership position business unit


  • Reduction in business diversification


Insights


The $1.8 billion sale of Sonoco’s TFP business to TOPPAN represents a significant strategic move that will reshape the company’s balance sheet and operational focus. The transaction’s value appears favorable and the commitment to use proceeds for debt reduction demonstrates prudent financial management. This divestiture aligns with the broader industry trend of portfolio optimization and could potentially improve Sonoco’s financial metrics, considering it represents about 36% of their current market cap of $4.96 billion. The debt reduction strategy should strengthen the balance sheet and potentially improve credit ratings, while the streamlined structure could lead to improved operational efficiency and more targeted capital allocation. The expected closure in H1 2025 gives sufficient time for regulatory approvals and smooth transition planning.


This transaction exemplifies a well-structured corporate carve-out with strong advisory support from Goldman Sachs and RBC Capital Markets. The cash-free, debt-free basis of the deal suggests a clean separation that should minimize post-closing adjustments and complications. The involvement of multiple tier-1 financial advisors and legal firms indicates the deal’s complexity and strategic importance. TOPPAN’s acquisition aligns with the consolidation trends in the packaging industry, where strategic buyers are seeking scale and complementary capabilities. The timing of the announcement, coupled with the expected closing timeline, provides adequate runway for regulatory review while maintaining deal momentum. The structure as an all-cash transaction reduces execution risk and provides immediate value realization for Sonoco shareholders.


Sonoco’s decision to divest TFP demonstrates a clear strategic pivot towards core competencies in industrial paper and consumer packaging. This move reflects a sophisticated portfolio optimization approach that should enhance operational focus and capital efficiency. By simplifying their business model, Sonoco positions itself for more targeted growth investments in remaining segments. The timing is particularly strategic given the current market conditions and industry consolidation trends. The deal provides a clean exit while maintaining business continuity through the transition period. For retail investors, this represents a positive catalyst as it reduces complexity, improves balance sheet strength and creates a more focused investment thesis centered on Sonoco’s core capabilities.












HARTSVILLE, S.C., Dec. 18, 2024 (GLOBE NEWSWIRE) — Sonoco Products Company (“Sonoco” or the “Company”) (NYSE: SON), a global leader in high-value sustainable packaging, today announced it has entered into an agreement to sell its Thermoformed and Flexibles Packaging business (“TFP”) to TOPPAN Holdings Inc. (“Toppan”) for approximately $1.8 billion on a cash-free and debt-free basis and subject to customary adjustments (the “Transaction”).

The Transaction, which reflects the completion of the previously announced strategic review of Sonoco’s TFP business, is subject to customary closing conditions, including regulatory approvals, and is expected to close in the first half of 2025. Net proceeds from the transaction are expected to be used to repay existing debt.

“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 Howard Coker, Sonoco’s President and Chief Executive Officer. “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.”

Goldman Sachs & Co. LLC is acting as lead financial advisor to Sonoco. RBC Capital Markets, LLC is also acting as financial advisor to Sonoco. Freshfields LLP is acting as Sonoco’s legal advisor. Houlihan Lokey is acting as lead financial advisor to Toppan. Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. is also acting as financial advisor to Toppan. Morrison & Foerster LLP is acting as Toppan’s legal advisor.

About Sonoco:
With net sales of approximately $6.8 billion in 2023, Sonoco has approximately 22,000 employees working in more than 300 operations around the world, serving some of the world’s best-known brands. With our corporate purpose of Better Packaging. Better Life., Sonoco is committed to creating sustainable products and a better world for our customers, employees, and communities. Sonoco was named one of America’s Most Responsible Companies by Newsweek. For more information on the Company, visit our website at www.sonoco.com.

Forward-Looking Statements

Certain statements made in this communication are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “accelerate,” “committed,” “enable,” “ensure,” “expect,” “future,” “will,” or the negative thereof, and similar expressions identify forward-looking statements.

Forward-looking statements in this communication include, but are not limited to, the Company’s pending Transaction and the anticipated timing thereof; the anticipated effects of the divestiture on the Company’s portfolio simplification strategy, streamlining of the Company’s organizational structure, and capital investments in the Company’s remaining businesses; and the Company’s expected use of the net proceeds of the divestiture.

These forward-looking statements are made based on current expectations, estimates and projections about the Company’s industry, management’s beliefs and certain assumptions made by management. Such information includes, without limitation, discussions as to guidance and other estimates, perceived opportunities, expectations, beliefs, plans, strategies, goals and objectives concerning the Company’s future financial and operating performance. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict.

Therefore, actual results may differ materially from those expressed or forecasted in such forward-looking statements. Risks and uncertainties include, among other things, risks related to the pending Transaction, including that such Transaction will not be completed on the timing or terms the Company anticipates, or at all; the ability to receive regulatory approvals for the Transaction in a timely manner, on acceptable terms or at all, or to satisfy the other closing conditions to the Transaction; the Company’s ability to realize anticipated benefits of the Transaction, or that such benefits may take longer to realize than expected; diversion of management’s attention; the potential impact of the announcement or consummation of the Transaction on relationships with employees, clients and other third parties; the Company’s ability to execute on its strategy, including with respect to portfolio simplification, organizational streamlining, and capital investments, and achieve the benefits it expects therefrom; and the other risks, uncertainties and assumptions discussed in the Company’s filings with the Securities and Exchange Commission, including its most recent reports on Forms 10-K and 10-Q, particularly under the heading “Risk Factors”. Except as required by applicable law, the Company undertakes no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed herein might not occur.

Contact Information

Investors
Lisa Weeks
Vice President of Investor Relations & Communications
lisa.weeks@sonoco.com
843-383-7524









FAQ



How much is Sonoco (SON) selling its TFP business for?


Sonoco is selling its Thermoformed and Flexibles Packaging business to TOPPAN Holdings Inc. for approximately $1.8 billion on a cash-free and debt-free basis.


When will Sonoco’s (SON) TFP business sale close?


The transaction is expected to close in the first half of 2025, subject to regulatory approvals and customary closing conditions.


How will Sonoco (SON) use the proceeds from the TFP sale?


The net proceeds from the transaction are expected to be used to repay existing debt.


What is the strategic rationale behind Sonoco’s (SON) TFP business sale?


The sale accelerates Sonoco’s portfolio simplification strategy, streamlines organizational structure, and enables more focused capital investments in their remaining industrial paper and consumer packaging businesses.





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