Sonoco to offload its Protective Solutions business to Black Diamond Capital Management for US$80M

USA – Sonoco, a sustainable packaging provider, has announced the finalization of an agreement by some of its subsidiaries to sell its Protective Solutions business to Black Diamond Capital Management, LLC for approximately US$80 million in cash.

This strategic move is aligned with the company’s vision to optimize its portfolio by concentrating on its core businesses.

The Protective Solutions unit, a prominent player in North America’s packaging sector, specializes in crafting components from materials such as expanded polypropylene and polystyrene foam.

It caters to a diverse range of industries, including the automotive and electronics segments.

Operating nine manufacturing facilities with around 900 employees and reporting financial results in Sonoco’s All Other Businesses segment, the Protective Solutions business has played a crucial role in Sonoco’s operations.

Howard Coker, President, and CEO of Sonoco, expressed, “We believe this divestiture builds on our previously articulated strategy to divest non-core assets and to refocus our efforts on core businesses to achieve greater scale, profitability, and market leadership.

“I personally would like to thank the entire Protective Solutions team for their years of delivering quality products and outstanding customer service on behalf of Sonoco.

“We know their knowledge, experience, and leadership will be greatly valued by their new owner and wish the entire team much-continued success in the future.”

The transaction, subject to customary closing conditions, is anticipated to be completed in the first half of 2024.

This development follows Sonoco’s recent acquisition of 100% shares of Inapel Embalagens, a Brazilian manufacturer specializing in mono and multilayer materials for flexible packaging.

Completed by Graffo Paranaense de Embalagens, a Sonoco subsidiary in Brazil, the acquisition enhances their capabilities to meet consumer demands.

Sonoco’s Graffo site, supporting rotogravure printing and lamination for eight years, will further expand its foil-based flexible packaging conversion.

Eduardo Nunes, Sonoco Flexibles’ managing director, will extend leadership duties to São Paulo locations, collaborating closely with Inapel’s former owners Rodrigo Alvarez and Monica Saniotto.

Nunes expressed satisfaction with Inapel joining Sonoco, complementing their long-term strategy. The acquisition aligns with Sonoco’s flexible packaging service expansion.

Russell Grissett, Sonoco Global Flexibles president, highlighted Inapel’s technical capacity and shared values, aiming to grow a sustainable packaging portfolio.

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